You've decided to take your company public and have completed the pre-IPO steps we outlined in Part 1 of this workshop. Now timing becomes key.

You've reached the selling point and are now in what is known as the "pre-IPO" period. This is the time when you'll want to do what has been called the "Road Show" or a series of appointments in which you make presentations about your company to interested investors and analysts. Often, commitments to buy shares of stock result from the quality of the "Road Show".

Restrictions on who you can talk to and what you can talk about are changing and anyone looking into an IPO in the near future should be aware of what's been proposed.

According to Bloomberg News:
"The Securities and Exchange Commission may require companies to open their presentations about initial public offerings to individual investors. SEC Commissioner Laura S. Unger says the SEC staff is preparing a proposal for submission to the commission in March or April that would widen the audience for companies' pre-IPO promotional presentations, called 'roadshows.' Ms. Unger said. These presentations typically are restricted to analysts and institutional investors. 'It would try to provide a level playing field in terms of providing access to investors for important information,' said Ms. Unger, one of five commissioners who will vote on the proposal. The SEC staff hasn't yet worked out how companies would give individual investors access to roadshows, but one way would be to broadcast them on the Internet, she said."

Work closely with your broker on the road show for your company and who you will take it to.

After the roadshow, the brokers will want to time the offering so economic conditions in the market appear most receptive to the offering. For example, you wouldn't want your stock brought to market during a sell off in technology stocks. You might want the market to be fairly boring so that you can create an event and make news. Or you might want to time the offering so that it coincides with other companies' successful IPOs when investors feel eager to "get in the game".

Good Advice for Linux Guys And Potential Partners
If you are partnering with a company that claims to be in a pre-IPO position or are poised to go to work for what looks like a hot start-up, beware of what I consider false inducements. Many start-ups say they're in a pre-IPO stage but it's wise to evaluate that for yourself.

Using the information in this series of articles, you can evaluate the status of pre-IPO companies, wade through the rhetoric and learn how astute and sincere their management is in that claim.