Businesses that have started to take off and have some success often have leaders who area always thinking about the next step to take. They are fortunate to have people like this guiding them, because that is the way they get to continue to grow. They can go from being a startup to a real playing in the industry. 

Two options available for financing continuing business operations going forward are to have either a public or a private offering. That is to say that one may choose to sell stock to the public via the stock markets, or they might hold a private sell for a select number of investors. A startup lawyer can help you determine which is the right choice for your startup, but here we take a look at the differences between the two options. 

A Public Offering

Ding Ding Ding! That is the sound of the opening bell on Wall Street. Of course Wall Street is just the name for a larger set of stock exchanges that the public trades stock on. The stock exchanges are places like the New York Stock Exchange or the NASDAQ.

It used to be that brokers would gather around at these marketplaces to trade shares with one another. These days though, most of the trading is done via computer. A business lawyer can do everything in his or her power to get your business on one of those stock exchanges if that is your goal. 

Financing comes via the public purchasing the shares in your company. A business attorney will work with banks and brokerage houses to create a legal document that turns your company into a set number of shares. The startup lawyer along with the bank will work together to try to create a fair valuation for the company. Then, the shares are opened up to the public markets for the public to decide the price. They buy the shares and flood the company with new capital to do the things it needs to do. The day a company goes public, the founders of that company often become quite wealthy themselves, at least on paper. 

A Private Offering 

Obviously, the opposite of a public offering is a private offering. The key difference here being that the public is not involved at all. The founders/owners of the business are still selecting to sell off part of the company in order to get the financing they need to move forward with key operations. However, in this scenario the company selects which people it will sell shares to. 

One of the advantages that a business lawyer might point out to you about doing a private offering is that the company is not subjected to SEC regulations. The SEC is the Securities and Exchange Commission, and they set the rules that govern public stock markets. 

Avoiding regulations like that means that you can continue to run things the way that you would like to run them. That is critical to a lot of people who do not want to be bossed around by some regulatory government agency. 

A business attorney might also push you in the direction of a private offering because then you are only dealing with people you know and trust. Selling shares to the public is a quick way to raise capital, but you lose a bit of the control over your company when you do so. Private investors might also demand certain changes, but at least with them you can work with them one-on-one to figure out the best path forward for the company.