Earlier this month the popular tech company Snap, owner of the hot app Snapchat, went public. It is just the latest example of a tech start-up that grew phenomenally by bucking the trends and cutting its own path, but that ultimately decided to take a more traditional route to fully capitalize on its success.
The crazy thing about Snap, is that its main product, Snapchat, is notoriously difficult for anyone over 30 to understand. Yet its IPO was a resounding success. Some reports suggest that the company’s devoted, young fan base may be the reason why. The Millennial generation, which has not been extraordinarily active in the stock market to date, bought a lot of Snap stock. And they are eager for other hot tech start-ups to join the market so they can keep buying.
Transitioning from being a start-up to being listed on the New York Stock Exchange is not an easy task. In fact, a lot of legal work has to go on behind the scenes to make such a transition possible. That is why when our firm is working with a client that is forming a business, we talk with them about their long-term plans, not just their immediate needs. There are a lot of things that can be done at the business formation stage that will ease some of the company’s growing pains in the long term.
It is not only companies that plan to go public that need to think about what sort of structure will be best for their business in the long term. Any business owner that plans to sell their business at some point, or may be interested in acquiring other businesses, needs to think about what type of structure will be best.
It can be hard to justify spending money on legal services when a business is just trying to launch and fighting for every dollar it has, but it is much cheaper to pay for legal help in the beginning than it is to hire an attorney to clean up a legal mess further down the line.
Many business owners are actually surprised how affordable getting legal help on the front end of things is because the only experience they have working with an attorney is calling someone in after things have gotten off track. If you are a Carolina business owner looking to form a new business, or take your existing business to the next level, don’t hesitate to contact us to set up an initial consultation at our office in Charlotte, North Carolina or Fort Mill, South Carolina.