Status quo to IPO: Ways to raise equity capital for your company

This article, by the managing director of NationsBanc Montgomery Securities, parses the steps for getting working capital or cold, hard cash for your training firm. He says that the market has never been hotter, but first you need a few facts and tools. Gay details the pros and cons of the main options for raising equity capital or selling your business: status quo, private minority investment, public minority investment (an IPO), and majority investment. The tips include how to work with outside investors, financial analysts, and bankers-what to expect from them and what kind of information about your business you need to provide to them. Gay outlines what he calls the three "cardinal rules" of initial public offerings: 1) Be prepared to under-promise and over-deliver on a quarterly basis, 2) consider the size of your company, and 3) recognize that market value is based on projected earnings. The article includes a glossary of financial terms you'll need to know, and a sidebar, So You Want to Sell Your Company, with the step-by-step process. Gay cautions in particular that bringing in outside investors is not for everyone, especially if you don't agree and can't comply with the cardinal rules. He concludes the article with a caveat emptor, strongly recommending that you should seek the services of a qualified financial advisor or investment banking professional before going ahead.