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Before you consider floating your business on the stock market, you need to determine whether it is ready for life on a public market.

Investors will only be interested in buying shares in companies that have secure earning streams and strong growth prospects. They will look for a good rate of return on any investment but will require a higher rate of return from an unproven, smaller business than from a large established company to compensate for the greater risks involved.

It is harder to guarantee a successful investment in companies new to the market. Smaller companies are more likely to suffer if market or financial conditions change - making investment in them risky.

You will need to consider whether your business can deliver that rate of return. You should ask yourself whether:

• your business has a strong record of delivering profits and growth
• your sector is attractive to investors
• your business plan sets out how you will deliver strong growth in earnings in the future
• your management team is up to the task of delivering the performance required

See tailor your business plan to secure funding.

If you feel your business is not at the right stage of development or will not be able to meet investor expectations of growth, you may want to consider other financing options - see business financing options: an overview.

The London Stock Exchange provides guidance for .

Even if your business is suited to flotation, it may not be the right choice for you. Being a public company can present a range of benefits to your business, but there are also issues that might require careful consideration.

Advantages of stock market flotation

The benefits of stock market flotation could include:

• Giving access to new capital to develop the business.
• Making it easier for you and other investors - including venture capitalists - to realise their investment.
• Allowing you to offer employees extra incentives by granting share options - this can encourage and motivate your employees to work towards long-term goals.
• Placing a value on your business.
• Increasing your public profile, and providing reassurance to your customers and suppliers.
• Allowing you to do business, eg acquisitions, by using quoted shares as currency.
• Creating a market for the company's shares.

Disadvantages of stock market flotation

However, you should also consider the following potential problems:

• Market fluctuations - your business may become vulnerable to market fluctuations beyond your control - including market sentiment, economic conditions or developments in your sector.
• Cost - the costs of flotation can be substantial and there are also ongoing costs of being a public company, such as higher professional fees.
• Responsibilities to shareholders - in return for their capital, you will have to consider shareholders' interests when running the company - which may differ from your own objectives.
• The need for transparency - public companies must comply with a wide range of additional regulatory requirements and meet accepted standards of corporate governance including transparency, and needing to make announcements about new developments.
• Demands on the management team - managers could be distracted from running the business during the flotation process and through needing to deal with investors afterwards.
• Investor relations - to maximise the benefits of being a public company and attract further investor interest in shares, you will need to keep investors informed.

For further information, the London Stock Exchange highlights .

When seeking to join a stock market, your business will be subject to legal and financial due diligence to help attract investor interest and to fulfil the entry requirements and documentation of the relevant market.

Access guidance from the London Stock Exchange on .

Your business also needs to have the right legal structure. The legal structure of a sole trader or a partnership is not suitable for a public market listing and as such a change to the company's legal structure would be necessary.

Public companies have different obligations to private companies under the Companies Act 2006. For example, private companies are no longer required to hold an annual general meeting (AGM) though they may opt to do so or be required to hold one if sufficient shareholders demand one. However, all public companies and private companies with traded shares must hold an AGM.

You will also have to make the following key information available:

• who the directors are and what service contracts they have with the company
• who the major shareholders are and details of the new and existing shares being offered for sale
• information on the company's key contracts
• the memorandum and articles of association

Typically, the admission process may take between three and six months to complete. To help with this process, you will need to appoint a set of advisers with relevant experience in helping businesses seek capital via the public markets.

Read more on the .

Getting the right advisers is key to a successful flotation. They are the experts who will guide you through the demanding legal, regulatory, financial and marketing processes.

A corporate finance adviser will be the central adviser to your company during the admission process and throughout your company's life on a public market. A range of other advisers will also play integral roles in 91香蕉黄色视频ing you through the admission process and thereafter. These include a broker, a reporting accountant, and legal, public relations and investor relations companies.

Bad advice, or using an adviser with a poor reputation, could seriously affect your business' reputation, ability to attract investors and float successfully.

Advisers' professional fees, which can run into six-figure sums depending on the size of the flotation, will be the main cost in floating your business.

Adviser roles

Most companies seeking a flotation use a corporate adviser to guide them through the process. The corporate adviser makes the application to join the stock market on behalf of the company. They are responsible for ensuring all the information in the application is complete and dealing with any requests for additional information.

• Companies floating on AIM must appoint a nominated adviser (nomad) who is approved by the London Stock Exchange to act in such a capacity - see London Stock Exchange .
• You'll also need a stockbroker to generate interest in your business in the investment community.
• Your corporate lawyer will be responsible for the due diligence process and for verifying statements in the prospectus and other documents.
• An accountant will be needed to conduct the financial due diligence and prepare any financial statements needed for the admission documents. You will also need to appoint the services of a corporate broker to seek investor interest in your business - the key reason for floating on a stock market.
• For large-scale floats it's also worth considering the services of a financial public relations company to reach wider audiences of investors.