As you may already know, Konzortia Capital is planning to go public through a reverse merger in the near future. We predict we will be ready by the beginning of 2022, and that this process will allow us to give our investors liquidity much faster. They will also potentially be seeing a higher ROI, because, as you know, public companies are valued at a higher price than private companies, as stocks vary their value depending on market sentiment. A reverse merger is one of the most optimal ways of undergoing such a process, but we would like to share with you the different roads a company can take on their journey to going public.
Initial Public Offering (IPO)
This is the most common process by which a company can go public, and it is virtually how every company today gets listed in the NYSE and Nasdaq. There was a surge in IPOs in the 90s, but currently, due to the flexibilization in regulations, raising capital privately is easier than it used to be, and companies don’t need to go public right away in order to raise capital.
An IPO is a complex process, and it can take months, or even years. Furthermore, the company needs to hire an investment bank to guide them through the process that collects a substantial percentage of capital raised in exchange for their services. Even though an IPO may be a straightforward process, it is time-consuming and quite expensive. On average, companies spend $750,000 and 18 months preparing for an IPO.
A reverse merger was one of the most popular ways of going public in the 80s. The process consists in a private company buying a public shell company with no assets and merging with it, thus becoming a public company in the process. It’s one of the fastest and most cost-effective ways to go public, as it takes only a few months to be finalized. Investors can gain liquidity and the company can continue to raise capital in a secondary market.
A direct listing is an alternative to an IPO through which companies can go public without issuing new shares.They simply list their equity on a stock exchange and sell them to the public. This process doesn’t allow companies to raise new capital, so it’s a process aimed at tech companies and other industries that are already quite affluent by the time they want to go public thanks to capital raising in the private sphere. It’s an efficient way for investors to gain liquidity and sell while avoiding investment banks, which are thought to be inefficient and outdated.
As you can see, a reverse merger has important advantages over the other alternatives, and it fits perfectly with our business plan. We foresee we will be ready to undergo a reverse merger in no more than a year, by which time our investor will be able to liquidate their shares in the Capitalista secondary market for private equity, where investors and traders will be able to invest in any tradable asset in the world, including KC shares.
If you want to become a part of Konzortia Capital before it’s too late and we move on to the next stage, you can leave your contact information at www.konzortiacapital.com and a member of our investor relations team will contact you shortly.