Financial Reporting Around Private Firms' Securities Offerings

This paper investigates how U.S. private firms communicate with investors around private securities offerings. Using multiple research methods including survey, interview, and archival analysis, I provide systematic evidence on private firms' public and private disclosure practices. I find that despite engaging in a low level of public disclosures, private firms actively communicate with investors through private communication channels, with notable variation across firms in terms of content and frequency. Consistent with managers providing relevant information, financial information is disclosed when it is particularly useful for investors' decision-making. Furthermore, I explore the relation between private communication and public disclosure preferences and find a substitutive effect, suggesting that private firms may strategically manage communication channels to effectively engage with investors. This study contributes to the literature by describing the existing disclosure landscape of private firms.