Key Takeaways: Managing Your Company’s Equity to Ensure Success in Your Public Offering and Beyond

By: Per Chilstrom , Jennifer J. Hitchcock

Watch the webinar here.

When creating a plan for your transition from a private to public company, share and equity plan management are essential to becoming “transaction ready.” Equity management has a number of areas of focus, including data integrity, systems and process infrastructure, regulatory compliance and participant engagement. The importance of understanding the tools available and communicating with your employees and shareholders cannot be overstated.

Below are some key takeaways from a recent webinar on the topic, led by Fenwick capital markets and public company partners Per Chilstrom and Jennifer Hitchcock, including valuable insights from Samantha Adams, Executive Director, IPO Strategy at Morgan Stanley, Katie Shaughnessy, Director of Strategic Pursuits at Computershare, Kathleen Murray, Lead Corporate Paralegal, Securities at Coinbase, and Cindy England, Equity Compensation Consultant at IPO Ready LLC.

Start early. Transitioning from a private company to a public company involves a lot of change. With that comes new systems and processes, new players and new regulatory considerations. Start 12-24 months out from your targeted listing date, if possible.

Build a public company infrastructure to achieve transaction readiness. If there is a potential IPO or direct listing on your horizon, begin implementing processes and behaviors to build muscle memory of good public company habits and business practices well in advance. Some of the functionality won’t be required until you actually go public, but with the underlying infrastructure in place, you can be flexible and pivot to whatever comes your way.

Find the right equity service providers. A company needs time to identify the right transfer agent, equity platform and brokers that can continue to support the company as it grows and scales. Request client references from service providers and leverage your network for their recommendations, ask detailed questions to confirm capabilities and solicit RFPs based on your expected needs, and make sure all parties have experience working together.

Get smart on public company compliance. This includes developing an insider trading policy, and familiarizing yourself with Section 16 reporting and Rule 144 compliance.

Educate employees. Equity comprises a large portion of many employees’ compensation and going public is often a major financial event for them. Be prepared to engage with employees regarding the management of their equity and create a forum to address employee questions and concerns.

Practice being a public company. Practice being a public company in advance. Perform monthly and quarterly closes, track performance against budgets, and hold mock earnings calls.

Some external resources discussed by our panelists include:; the National Association of Stock Plan Professionals; and

Be on the lookout for more tools and resources to help you be well prepared for your debut as a public company, the expiration of your lock-up, your first quarterly earnings release and beyond.

Watch the webinar here