An IPO is a process most company owners go through once in a career. How prepared the company is when it reaches the decision determines the outcome as much as the decision itself. The quality of preparation makes a tangible difference at every layer, from financial infrastructure to corporate maturity.
This article explains what IPO advisory is and what the preparation process actually covers.
Why go public?
Companies list for three main reasons:
- Growth financing: an alternative to bank debt, capital without a repayment obligation
- Liquidity for shareholders: existing holdings become convertible to cash
- Corporate visibility: brand recognition, credibility, the ability to attract qualified talent
The costs that must be weighed against these are real: continuous reporting obligations, public disclosure, governance discipline and responsibility towards minority shareholders. An IPO is not a destination but a new way of operating.
The readiness assessment: the first step
The advisory process begins not with the question "when do we list" but with "are we ready". The headings examined in this assessment:
Financial infrastructure. Are the financial statements aligned with market standards, are they independently audited, is the reporting routine sustainable? Listed companies are legally required to report regularly and on time; the listing process cannot begin before this infrastructure is in place.
Corporate structure and governance. Is the shareholding structure simple, are related-party transactions clean, does the board structure meet the requirements? In family companies this is usually the part that demands the most work.
Operational maturity. Can the company operate independently of its owner? Are key functions staffed with an institutional team?
The story. Is there a growth story to tell investors, and is it supported by the numbers?
The output of this assessment is a gap analysis: the difference between the current state and the required state, and the time needed to close it.
The equity story and valuation positioning
In an IPO, a company's value is formed not by the numbers alone but together with the story being told. The questions an investor wants answered are simple: Why will this company grow? What is the source of the growth? What does it do differently against the competition? Where will the proceeds go?
The answers must be supported by the company's real operational data. In industrial and natural-resource companies this means concrete items: capacity, efficiency, reserves, licence duration and cost structure. A generic growth promise does not survive experienced investors' first screening; at later stages the file cannot complete review because the operational data is missing.
Valuation positioning is the story turning into a price. An optimistically framed price range creates the risk that investor demand falls short of expectations; a cautious framing creates no cash expense, but leaves a lasting effect on return on equity in the following years.
Who is involved in the process?
An IPO is a multi-party process: the underwriter, the independent auditor, legal counsel, the regulators and the IPO advisor. Each party has a defined role; the advisor's function is to coordinate these parties and to run the company's technical preparation and compliance management for the process.
Denizoğlu Capital's approach in this area concentrates on the preparation side of the company's listing journey: gap analysis, building the financial infrastructure, constructing the equity story and valuation positioning.
Steps of the process
- 01Readiness assessment and gap analysis
- 02Closing the gaps: corporate structure, reporting, governance
- 03Constructing the equity story
- 04Selecting the underwriter and other parties
- 05Regulatory process and documentation
- 06Investor targeting and marketing
- 07Pricing and listing
The first three of these steps are usually the longest and the ones requiring the most effort from the company itself.
Frequently asked questions
What size of company can go public?
Size alone is not the determining factor; corporate maturity, financial transparency and the persuasiveness of the growth story matter at least as much.
How long does preparation take?
It depends on the company's starting point. For a company with its corporate infrastructure in place the process is shorter; for one that has not completed its institutionalisation, preparation can extend over months, sometimes beyond a year.
Is an IPO the only option?
No. Private equity investment, strategic partnership or debt financing should also be considered for a capital need. The right question is not "how do we go public" but "which source best fits this need".
Denizoğlu Capital manages the process in IPO advisory from readiness assessment to listing, with company valuation and CFO transformation carried out under the same roof.
Frequently asked questions
- How long does an IPO take?
- Including preparation, generally one to two years; shorter for companies with their corporate infrastructure in place.
- What is the first step?
- The readiness assessment: establishing whether the company is prepared in terms of regulation, reporting and corporate governance.
- Who sets the price?
- The price range is set jointly by the underwriter and the company, taking market data and comparable companies into account. The final price forms within that range as a result of book-building.
- What happens if the company is not ready?
- The process is deferred and the gaps are closed. An early readiness assessment allows the timetable to be built correctly and resources to be used efficiently.
- What changes after the IPO?
- Periodic reporting, public disclosure and investor relations become a permanent responsibility.