List Your Company in
States By William Cate Published March 2000 [http://home.earthlink.net/~beowulfinvestments/] [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]The alternative to listing your shares on OTCBB is to list them on NYSE, AMEX NASDAQ or a Regional American Stock Exchange. The Target Company balance sheet and time argue against using New York Stock Exchange (NYSE). Target Companies could meet American Stock Exchange (AMEX) listing requirements with their first acquisition. AMEX has an institutional investor following that NASDAQ lacks. AMEX is owned, but not operated by NASD. It’s a better choice than NASDAQ. I believe that NASDAQ has structural problems of OTCBB/BBX. While I’m willing to work with a Target Company desiring to list on NASDAQ, I strongly advise against it.
The Regional Stock Exchanges include Boston Stock Exchange, Chicago Stock Exchange (formerly Midwest Stock Exchange), Philadelphia Stock Exchange, Cincinnati Stock Exchange and Pacific Stock Exchange. The NASD owns, but does not operate Phila-delphia Stock Exchange. These five Stock Exchanges are aggressively seeking listings. You can list of any of them for about US$350,000. As with your Target Company SEC registration, primary costs involve your American attorney’s legal fees. I suspect BBX will help these four stock exchanges expand number of listed companies.
The greatest cost in going public is cost of maintaining your share price. Unlike most sales, original seller is responsible for finding all later buyers of their shares. It’s this cost that destroys public companies.
"Follow Swiss Currency Formula" is first axiom of a strong share price. Don’t issue shares unless you receive cash-producing assets as benefits. Issuing stock to employees is a terrible policy. If your employees want to buy your stock, let them do so from their stock broker. Paying bills with your stock always costs your Target Company a multiple of face value of bill. Your creditor sells your stock and you become obligated to find all buyers for those shares for next several years. The cost of finding those buyers exceeds face value of bill. At best, practice defers bill payment for a year or two.
It costs less to keep your present shareholders than to find new investors to buy your stock. Your investor relations should focus upon keeping your existing shareholders. If you attract shareholders based upon an implied promise that your shares will appreciate in value, those shareholders will sell into that share price appreciation. Your shareholders must share your Target Company vision. You must offer them reasons for keeping their stock. For years, I’ve favored non-cash benefit program for shareholders. Secure discounts and deals on items and services average small capital investor needs. This can range from fleet buying of cars to cruise ship discounts. Try to ensure that non-cash discounts equal value of your shares to average shareholder every year. If you do so, very few of your shares will enter Market.
Remember that stocks are sold, they aren’t purchased. This means that you have to find and pay people to sell your stock. There can be no assurance that Investor Relations staff you contract to use can sell your stock to anyone. Over a decade ago, an extremely successful American Investor Relations firm attempted to promote their stock. Their effort failed, badly. Almost nobody purchased their shares. They used techniques that had worked for their clients. If an Investor Relations firm can’t be certain to create buying for themselves, you can’t be certain they can create buying for you. Even if they can’t sell your shares, you will pay dearly for their efforts.
