Traditional Underwriting
Time:
6 to 12 months
Cost:
$175,000 to $500,000. (The company will be out of pocket at least 50% of this amount prior to completion.
Capital:
Typically raises more capital than other types of transactions.
Problems:
Underwriting may be delayed or canceled. Issue Price may be changed by market conditions or underwriter.
Reverse Merger or Buy an Existing “Public Shell”
Time:
2 weeks to 60 days
Cost:
$150,000 to $400,00
Capital:
Does not raise money but stock is now valued and tradable
Problems:
Potential “skeletons” in acquired shell. Control shareholders of operating company may receive restricted shares.
Advantages:
Typically Reverse Merger or Public Shell Merger is the quickest way to get public. Non-control investors may receive registered or trading shares.
Merge with a Brand New Flex Financial Public Company
Time:
4 to 8 months
Cost:
$75,000 to $150,000
Capital:
May raise money and stock is now valued and tradable
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