photo credit: star5112

Startup founders can pay back their investors by either selling the business to bigger companies or offering shares to the public (IPO). Public offering seemed to be the ultimate goal of every startup since it promises continuing returns and expansion. Yes, its true many startups still dream of a place on the NASDAQ and startups like Twitter, Facebook, LinkedIn, Zynga also want to go public rather than sell.

But in a recent survey of startups by venture capital firm DCM, only 19 percent wanted to go public. Many startup founders mentioned that a major barrier to go public was the strict regulations for public companies. They believe that there is so much emphasis on paperwork and legislation that a startup can’t focus on actually building a business. Newer restrictions are making public offerings less and less attractive for startups.

"People don't want to run public companies anymore because they don't want to get dragged through the mud," said Rob Coneybeer, a managing director at the investment firm Shasta Ventures

Read the article below for more information:
http://www.mercurynews.com/business/ci_14218184?source=rss&nclick_check=1