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Public company: Advantages andDisadvantages. Advantages Access to Capital - Emerging growth technology companies often have limited access to
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E4: Public company: Advantages and Disadvantages. Advantages Access to Capital - Emerging growth technology companies often have limited access to capital. The fact that their assets walk out the door at the end of every working day makes it very difficult to obtain financing from banks or other traditional sources. However, technology companies often need significant amounts of capital to maximize the development and/or marketing of their technology through an invariably limited window of opportunity. As a result, it is very difficult to build a technology company through cash flow - it is just too limited. The public markets allow technology companies with strong growth potential to raise the capital necessary to develop full speed ahead. Further, the principals of such companies will usually retain voting control subsequent to the initial public offering. Once the company is public, subsequent financings are easier as the company has a track record with investors and the...
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