Capital and Securities

Solve the Problem

You work for a private corporation. The corporation is in need of capital. One member of the board has suggests, "Let's go public!" You are a financial analyst for the company. You are not too sure that simply "going public" will solve the company's need for capital. The CEO, you have been interning for, asks you to evaluate the situation and present whether or not an IPO is the best choice. The CEO would also like options to raising capital another way.

In order to accomplish everything that the CEO wants, she has agreed to let you do substantial research into companies that have failed and succeeded, and use those companies as a guide. She needs options. She needs reasons why each option may succeed or fail. She must present to the Board of Directors and needs real answers from you.

Do your research and design a report and presentation to present to the CEO and other executives.

Step 2

Research Companies that have gone public. Begin with Google.

• Google
  • Research ways to raise capital, include the pros and cons of each.
  • Research 2 companies of your choice- 1 that had a successful IPO and one that had a disastrous IPO.
  • Review the financials at Google's Investor's website
  • Read the Google case study in chapter 2 of Handbook of Corporate Equity Derivatives and Equity Capital Markets