Raising Capital - Public & Private

[CSykes]

Interesting board.. I write PPM's and consult Companies on going public. I can tell you that the majority of firms out there charge over $75K-$120K to take a Company public. The true costs break down like this for a typical start-up..

1. Private Placement (Reg D 504) $1,500
2. Create shareholder base $5,000
3. POACB audit $2,000-$4,000
4. Transfer Agent $1,500-$2,500
5. Prepare template SB-2 $2,500-$5,000
6. Legal opinion letter $2,000
7. S&P Corporate Manual listing $6,000
8. Market maker (form 211) free-??

A typical single owner start-up using a pre-defined process can go public for about $20,500 or more. Most consultants make about $50K or more taking a company public. I prefer to charge the client less and take more equity.

Raising capital however is another story. The business has to be interesting to get decent financing. If not.. Cornell Capital and NIR group always have PIPE's they will sell you!