The right insights, right now

Access the latest news, analysis and trends impacting your business.

Explore our insights by topic:

About Broadridge


The Ultimate IPO Checklist

The IPO process is not an easy one, so we've compiled a checklist to help you simplify and navigate.

The Ultimate IPO Checklist

The IPO process is one of the most important yet complex events that a growing company will go through. From financial scrutiny by investors, auditors and regulators to continuous collaboration among investment bankers, lawyers and accountants you must be prepared to manage large amounts of information and accompanying analysis.

What is an IPO?

An IPO or “Initial Public Offering” is the process of offering shares of a private corporation to the public in a new stock issuance.

Advantages of an IPO

Often companies choose to enter into an IPO for one or more of the following reasons:

  • Increase long-term capital
  • Greater access to cash and improved liquidity
  • Opportunity for initial founders or investor groups to cash out
  • Reward and offer monetization to employees with shares
  • Elevate the company’s profile and presence in its industry

If you’ve never taken this road before, there’s a number of steps and obstacles that need to be considered. As legal counsel, it is important to understand the entire IPO process to build a successful strategy. This IPO checklist will act as your roadmap to navigating the complex process and steps yet to come.

1. Hire the Right Team

Choosing the right team of experienced professionals to handle the IPO process is critical for success. The following entities are enlisted by the company to help manage the process:

Investment Bank

The investment bank serves as the intermediary between the company seeking to issue shares in an initial public offering (IPO) and investors and acts as the underwriter. The bank helps the company prepare for the IPO and is involved in every step of the process, including due diligence, document preparation, filing, marketing and issuance.


Lawyers play a crucial role in the IPO. The process involves numerous complex federal and state regulatory requirements. Lawyers are responsible for ensuring the transaction is structured to adhere to the law. They are expected to advise issuers, underwriters and bankers on how to complete the IPO within the regulatory framework. If the SEC, a state regulatory agency or an investor uncover violations in any of the filings, the company could face serious penalties. This includes criminal or civil securities fraud charges or the assertion of shareholder rescission rights.

Service Providers

Ensuring that the right tools are in place to handle the IPO process is critical. IPOs require countless hours of work and collaboration between multiple parties – the firm going public, bankers, lawyers and more. With so many people working with so much sensitive information, a virtual data room platform is often required to host and manage the information-sharing and collaboration involved in different stages of process. Virtual data rooms like SmartRoom are ultra-secure and allow IPO-ready companies to control view, print, save and modify rights across large user bases so that communication can be streamlined among key stakeholders while ensuring absolute security. SmartRoom even allows companies to gain insight into investor activity through real-time reporting and analytics. Administrators can see which documents potential investors are most active with so they can plan their strategy appropriately. Features like automated alerts keep stakeholders up to date when new documents are added or when existing documents are edited.

Financial Printer

A financial printer will work with your law firm to create and file S-1 prospectus and other SEC-required documents necessary for your IPO. Your S-1 prospectus will go through many iterations (proof cycles) and often several filings with the SEC throughout the process. Your financial printer will process “Author’s Alterations” and EDGAR Filings of your document until finalized, including style, formatting and printing.

2. Conduct due diligence

The banks, underwriters and lawyers will conduct an in-depth audit of the entire company, which is known as the due diligence process. The review includes all financial, tax, legal and IP information, industry and market research, and customer verification. The goal is to gain full transparency into the operations of the company and potential risks, and to assure all claims made in the company's registration statement are complete and accurate. 

3. Develop the IPO prospectus

The company and the IPO lawyers will use the information found in due diligence to draft all principal offering documents, including the IPO prospectus, which must be filed with the SEC as part of the IPO registration statement. The IPO prospectus paints the complete picture of a company, highlighting its strengths, strategy, market share, products, financials and overall investment opportunities. The prospectus must also provide full disclosure of any potential risks involved for investors, as well as any other mitigating factors. The IPO prospectus is subject to extensive disclosure requirements, so it is paramount that all parties collaborate to ensure the prospectus is detailed and accurate.

4. File the IPO Registration Statement with the SEC

IPO lawyers are responsible for filing the IPO prospectus and the entire registration statement with the SEC. There is a 30-day review process when the filing is subject to review and comment by the SEC. Once this process is complete, the company will complete an initial listing application with the exchange. Underwriters will then file compensation information for the IPO with the Financial Industry Regulatory Authority (FINRA).

5. Pre-IPO Placement

Before the public IPO, the investment bank markets the IPO to private investors to maximize the company’s position. These private investors in a pre-IPO placement are typically large private equity or hedge funds that are willing to purchases a significant volume of shares. The size of the investment means the pre-IPO placement share price is usually less than the prospective IPO price.

6. The IPO “Roadshow”

Over the course of several weeks leading up to the IPO, the investment bankers and company’s management team will hold what is referred to as a “roadshow.” The roadshow is a series of presentations marketing the IPO to potential investors and is usually when the offering size and price range for shares is first announced. The goal of the roadshow is to generate interest of potential investors to help drive up the initial sale price. 

7. Set Share Pricing

Based on interest during the roadshow and a variety of other factors, the investment bankers will set an agreed-upon price that determines the initial value of each share.

8. Allocate Shares and Initiate Trading

A few days after pricing is set, the IPO will close, and the issuer and any selling stockholders must release their shares to the underwriters. Once all shares are released, the institutional investors who have already purchased shares will get their allocations and public trading will begin.

The IPO process is not any easy one. Understanding the process and implementing a well-thought-out strategy is vital to a successful IPO. There is enormous pressure on all parties involved. One mistake or error made at any point in the process can have serious consequences for the entire transaction. It is important to invest in the right resources to ensure any IPO process in which you are involved is managed efficiently and securely. With so many different people working with so much information, having a secure, collaborative virtual data room platform, where multiple stakeholders can access critical information from anywhere at any time, can make all the difference.