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Am I the only one who feels that if I'd put in the blood, sweat and tears to build a company to the point where it could be IPO'd I'd be more likely to gouge my eye out with a rusty spoon that open it to the sharks, sociopaths, speculators and manipulators of wall st and the open market?



You're probably not along. At the same time, I believe significant number of people (myself included) will respectfully deem this view too gloomy and pessimistic. One could probably use the same logic arguing about the first (or second, ...) round of VC financing.

In each case, you are relaxing some control of your company in exchange for something else valuable: other people's money. Whether such exchange is fair or not depends on specific circumstances; each side can always ask for more (money, control) to make the exchange fair.

I don't know of any company of any significant size (e.g. with >$100M of annual revenue) that hasn't made such an exchange at some point in its history.


There are hundred of companies that meet your criteria and dozens with sales in the billions. A few I can think of off the top of my head: M&M/Mars - owned by 3 siblings, Koch industries - owned by two brothers, and Bechtel. They are family owned businesses with a penchant for secrecy.

Edit: From another story on the home page right now - Red Bull $5B in sales


Thank you for setting me straight. Of course there are many privately-held companies that existed for decades and never took public money.

I would bet that most of these companies were created decades ago and that most of the recent "success stories" took public money at some point - anybody knows any examples?


There's a big difference between a VC round and the open market. The markets are often not driven by anything even related to the companies whose valuations fluctuate wildly by billions of dollars in under a second. They don't open to you (to same degree) to hostile takeovers, pump-dump schemes and naked short attacks. They force companies to kowtow to the opinionated whims of unaccountable analysts and focus on short term profits over long term strategy.


I'm sorry, but I don't see why people are so hostile to trading in the open market.

The public stock market is a real-time debate about valuation in the open. The VCs do it behind closed doors. Being critical of the markets for being divorced from reality is fine, but surely having a public stock price is better than having it all hidden from view?

If you're not a fan of more openness, maybe you are hoping to 'pick off' a VC who over-values your company, away from a public analysis of its actual worth?

As for having a public listing forcing a company to do anything - it's not true at all (except for publishing audited accounts). The company is free to ignore the gyrations of the market, and keep its plans secret too.


An IPO is the act of selling your business to the public. You are definitely not the only one who may prefer to stay private. It's a business decision the each individual business faces.


Cargill. 2009 revenues of $116 billion. (That's declared revenue.)

Is, was, and will be privately held for the forseeable future.


IPOs are good for the ego because it allows founders to liquidate their equity without selling control of the company to someone else. You will need to cash out eventually. Dividends may not be lucrative enough.

Also, eventually your employees with stock options and investers will want to see liquidity to stick with you.

Finally, you may not have a choice. A company must become public after it has 500 shareholders. This can happen if you have enough investors and enough employees exercising their options early (presumably because they have left the company).




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