Smooth Sailing for a Successful IPO: Finance & Legal Tips for Going Public and Being Newly Public
Transcript of Smooth Sailing for a Successful IPO: Finance & Legal Tips for Going Public and Being Newly Public
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Smooth Sailing for a Successful IPO How to prepare for high seas and big adventure
August 6, 2015
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Welcome!
About today’s webinar: (housekeeping) • 1 hour online program
• You can submit questions at any time through the “chat” box on your lower right side of the console
• You can view it at full screen if desired • Click the third icon from your left (on lower left side of console)
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• We are happy to share the presentation slides after the program – send us a chat message; or email [email protected]
• We are recording this event and will circulate the replay link to you
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Agenda
Introduction: The IPO Journey Susan
Navigating Legal Waters Matt
Strengthening Finance Operations Diana
Executive Priorities Susan
What to Watch Out For Panel
Final Thoughts Panel
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Bio - Diana Gilbert
Diana has 30 years of corporate and operational finance experience focusing on technical accounting, process improvement and financial systems, due diligence and transitional support for mergers, acquisitions and divestitures, SEC reporting, Sarbanes-Oxley, and revenue recognition.
She is the Director of RoseRyan’s Technical Accounting group and a member of the Corporate Governance team. As a RoseRyan senior consultant she has advised such clients as AcelRx Pharmaceuticals, Alexza Pharmaceuticals, ArcSight, Bell Biosciences, Catellus Development, Cepheid, Coupons.com, DNAnexus, Informatica, Mendel Biosciences, Mimosa Networks, Vivus, and Zynga. Prior to RoseRyan, she held Corporate Controller positions at VNUS Medical Devices, Electroglas and Digital Interiors, various management positions at HearMe and CIDCO, and was a Senior Manager at KPMG.
Diana is a CPA (inactive), and holds a BS in Business-Accounting from San Jose State University.
Senior Consultant RoseRyan, Inc.
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Bio - Matthew Rossiter Partner
Fenwick and West LLP
Matthew Rossiter represents startup companies, established public companies and venture capital investors, with particular focus on the healthcare and enterprise software industries. He advises clients on a variety of corporate and intellectual property transactions, including the formation of startup ventures, equity and debt financings, mergers and acquisitions, and complex commercial and intellectual property transactions. Matt is the lead researcher and co‐author of Fenwick & West’s Life Sciences Financing Survey, a biannual report that analyzes the valuations and terms of venture financings for the U.S. life science companies, as well as trends in life science financing, VC fundraising, M&A and IPO activity.
In addition, Matt served as an interim in-house legal counsel for Virgin America during the startup phase of its operations. Matt is a frequent lecturer at Stanford Law School and Wharton Business School. While in school, Matt was a member of the Duke Law Journal and was named recipient of the Faculty Award in Business Organization and Finance.
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Bio – Susan Berland Consultant
Finance & Strategy
Susan Berland is a financial executive with expertise in diverse areas of financial management and business transactions gained in over 20 years of experience. She has been a member of management teams that have concluded successful financings as secondary and IPO stock offerings, debt instruments, and private placements. Her senior management experience has included the positions of Chief Financial Officer for Mendel Biotechnology, Poniard Pharmaceuticals, Director in Monsanto’s Company’s corporate M&A group, and then subsequently leading that Company’s Financial Planning function through their merger with Pharmacia & Upjohn.
She has worked in a variety of industries including life sciences (pharmaceuticals, molecular diagnostics, and medical devices), agriculture (seed operations, biotechnology, and crop protection), and telecommunications.
As a consultant to the life sciences industry her clients have included such companies as Veracyte Inc., Atreca Inc., Presidio Pharmaceuticals, Sierra Surgical Technologies, Ceres Inc., and Richmond Chemical Co. Ms. Berland holds MBA and BBA degrees from the University of Wisconsin – Milwaukee.
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Introduction
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The IPO Journey
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Early decision focus to support being public
Evolve policies & practices
Build relationships with investors, analysts, press
Educate employees
Team / roles
Timeline
Messaging: internal & external
Document creation, SEC filings
Roadshow
Be ready for the ‘day after’
Communications and Public Image
SEC reporting, XBRL
Deadlines
Earnings release, EPS, metrics
Compliance
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Navigating Legal Waters
Matthew Rossiter Fenwick & West LLP
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Key Legal Considerations
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
What it takes (… to be a marketable public company)
Management team and board development
Get to know investors
Raise public profile
Mezzanine (“cross over”) financing
Intensive 4-6 month process
JOBS Act has changed the game
Confidential filing and marketing
Relaxed disclosure requirements
Disclosure of material developments
Affirmative obligations
Investor expectations
Regulation FD
Building relationships with analysts and investors
Guidance (earnings and key developments)
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JOBS Act Confidential S-1 submission
• Must flip public 21 days before road show
Improved marketing of IPO process • “Testing the waters” meetings (marketing to QIBs and
AIAs) pre- and post-org meeting
• Relaxation of rules re research analysts
Relaxed IPO and post-IPO disclosure obligations • Reduced S-1 financial statement requirements
• Reduced executive compensation disclosure
• Exempt from SOX 404(b) auditor attestation
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Life as a Public Company Transitioning out of EGC status
• 5th year after IPO or sooner if public float > $700M
Disclosure of material developments • Affirmative obligations – Form 8-K etc.
• ‘Voluntary’ disclosure, driven by: • Investor expectations, Regulation FD
• Insider trading concerns
• Exchange listing requirements
• Operating a good disclosure committee
Building relationships with analysts and investors • Same principles as for ‘voluntary’ disclosure
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Strengthening Financial Operations
Diana Gilbert RoseRyan
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Getting Your House in Order
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Technical accounting
Equity
Financial audits
Streamline close
Internal controls
Systems
Data warehouse
Team / roles
Timeline
Messaging
SEC response team
SEC reporting
Deadlines
Earnings release
EPS, Metrics
XBRL
SOX 404
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Start Acting Like You’re Already Public
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Technical accounting
Equity
Financial audits
Streamline close
Internal controls
Systems
Data warehouse
Team / roles
Timeline
Messaging
SEC response team
SEC reporting
Deadlines
Earnings release
EPS, Metrics
XBRL
SOX 404
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Put the Right Team in Place
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Technical accounting
Equity
Streamline close
Financial audits
Internal controls
Systems
Data warehouse
Team / roles
Timeline
Messaging
SEC response team
SEC reporting
Deadlines
Earnings release
EPS, Metrics
XBRL
SOX 404
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Shift Into High Gear
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Technical accounting
Equity
Financial audits
Internal controls
Streamline close
Systems
Data warehouse
Team / roles
Timeline
Messaging
SEC response team
SEC reporting
Deadlines
Earnings release
EPS, Metrics
XBRL
SOX 404
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Internal Controls
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Technical accounting
Equity
Financial audits
Internal controls
Streamline close
Systems
Data warehouse
Team / roles
Timeline
Messaging
SEC response team
SEC reporting
Deadlines
Earnings release
EPS, Metrics
XBRL
SOX 404
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Management’s Challenge: Confident Leadership Through Major Change
Susan Berland Finance & Strategy Consultant
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Who You Know and What You Say Matters
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Management/Board
Have the right resources
Prepare for legal & financial scrutiny
Build relationships & public image
Find & fix your weaknesses
Filings, Roadshow, Pricing, Listing
Team / roles
Timeline
Messaging
Constant communication
Rapid Response
SEC Reporting
Investor Relations
Talking to The Street
Company Insiders
Earnings Release
Compliance
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Start Early: Skills and Quality Processes Take Time
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Filings, Roadshow, Pricing, Listing
Team / roles
Timeline
Messaging
Constant communication
Rapid response
SEC Reporting
Investor Relations
Talking to The Street
Company Insiders
Earnings Release
Compliance
Management/Board
Have the right resources
Prepare for legal & financial scrutiny
Build relationships & public image
Find & fix your weaknesses
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Getting the Show on the Road
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Management/Board
Have the right resources
Prepare for legal & financial scrutiny
Build relationships & public image
Find & fix your weaknesses
Filings, Roadshow, Pricing, Listing
Team / roles
Timeline
Messaging
Constant communication
Rapid Response
SEC Reporting
Investor Relations
Talking to The Street
Company Insiders
Earnings Release
Informed Employees
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Sustained Success After the IPO
Phase 1 Phase 2 Phase 3
1-2 years prior to IPO
IPO Process
Newly Public
Filings, Roadshow, Pricing, Listing
Team / roles
Timeline
Messaging
Constant communication
Rapid response
SEC Reporting
Investor Relations
Talking to The Street
Company Insiders
Earnings Release
Informed Employees
Management/Board
Have the right resources
Prepare for legal & financial scrutiny
Build relationships & public image
Find & fix your weaknesses
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What to Watch Out For
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What to Watch Out For
Perspective of the Officer Susan Berland
Perspective of the Attorney Matt Rossiter
Perspective of the Accountant Diana Gilbert
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Final Thoughts
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Resources – where to get more Whitepapers: (from RoseRyan)
• The IPO Journey - 6 potential obstacles to avoid
• Ensuring a smooth ride as a newly public company - explores Day 2 dilemmas
• Ace your IPO filing
• IPO in your future?
• Download at : http://www.roseryan.com/roseryan-intelligence/
IPO Trends survey 2014 (from Fenwick & West) • https://www.fenwick.com/publications/pages/technology-and-life-sciences-ipo-
survey-2014-full-year.aspx
An Overview of IPO Process (from Fenwick & West) • https://www.fenwick.com/publications/Pages/An-Overview-of-the-IPO-
Registration-Process.aspx
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Thank You
Contact Us
Susan Berland [email protected]
Diana Gilbert [email protected]
Matthew Rossiter [email protected]