This is not the correct answer, although it is possible for a company to go public this soon. Michael Dell started his now-famous company in 1984 with $1,000 in personal savings and raised $30 million with an IPO in July 1988. Pierre Omidyar started eBay as a hobby in September 1995 and went public almost exactly three years later in September 1998. However, there is no guarantee your company will grow as fast as Dell and eBay, which today are both listed on the NASDAQ stock exchange.
This is not the correct answer, although a company could go public in 7-8 years. Fred Smith, founder of Federal Express developed the idea for his company while he was attending Yale University. Fedex was founded in 1971 and went public in 1978 on the NYSE. However, there is no set rule on how long it takes a company to go public. Starbucks was also founded in 1971, but wasn’t listed on NASDAQ until 1992 — 19 years later.
This is the correct answer. No one knows exactly how long it will take for a company to be ready to go public. It could be 3 years, 10 years, 20 years, or more. But, history does show that a company that starts out with the goal to go public will reach that goal much faster than companies that make no plans. You are way ahead of the race because you are already considering the possibility of taking your company public!
Sorry, this is not the correct answer, although many companies do go public within 10-11 years. Microsoft was founded in 1975 and was listed on the NASDAQ as a public corporation in 1986 — only 11 years later. But not all companies want to go public as fast as they possibly can. UPS was founded in 1907, but wasn’t listed on the NYSE until 1999, which was 92 years later. Although UPS certainly could have gone public sooner, the company chose to wait many long years before making the leap.
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| Lesson 6 Screen 1 | |
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Timing is Everything We'll start Lesson 6 out with a question. See how you do: |
After a company is started, how soon will it go public?
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