Advantages of a Reverse Merger

• Market Conditions – Many times management has a “window of opportunity” in which to take their company public. This could be the result of current market conditions or a perception that their company is in a hot industry or they have a product or service that is deemed to be a “category killer”. Whatever the reason you know it is in your best interest and the company’s to get public as soon as possible. The good news is that you can expedite the process of going public through a reverse merger much quicker than an IPO. The best news is once you have filed your 8K with the SEC you can then start to distribute a “draft” of your offering memorandum to prospective accredited investors for raising capital. Your final offering document will be distributed along with monies raised subject to the successful completion of your reverse merger.

IPO’s are another story. Because of the length of time it takes to get approved – at least 9 to 12 months - there is no guarantee there will be a market for your IPO when it finally becomes available. It it is not received with open arms the IPO “window” is said to be “closed” and your underwriter will pull the deal from the market. So basically, you have just spent over $2 million dollars with nothing to show for it but audited statements. This happened to many companies when the window slammed shut following the tech crash of 2000.

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