With inflation persisting and interest rates on the rise, coupled with an unstable job market and banks facing insolvency issues, the idea of going public in this uncertain economic climate may seem far-fetched for finance leaders who prefer to be cautious and wait for more favorable economic conditions before taking any risks.
However, for those daring finance leaders who remain committed to pursuing their IPO plans regardless of the prevailing market conditions, the process remains just as complex and overwhelming as ever before.
Seek Guidance
The IPO process can be intricate, particularly for inexperienced or first-time CFOs, who may find it overwhelming. It’s advisable for finance leaders to seek guidance from consultants or tap into their professional network as they will not be portrayed as heroes within their organization should they lead an IPO initiative alone. Given the complexity of the process, there is little room for error, and any CFO who attempts to use it as an opportunity to showcase their skills to the C-suite and their company may end up putting their organization at risk.
While it is advisable to seek guidance and depend on the Big Four accounting firms to guide you through the pre-IPO process, finance leaders should not assume that the firms have the capacity to can handle everything alone. It is important to seek assistance and collaborate with the firms to ensure that each stage of the process is executed accurately.
Practice Agility While Cultivating Patience
When turning to help, especially through the Big Four firms or a consultancy agency, be mindful of the labor constraints these companies are facing. Similar to the companies they serve, these firms are grappling with a shortage of skilled labor, particularly accountants. Consequently, the fees charged by these firms for their services may be higher, the process may take longer, and they may have to assign the task to junior or less experienced professionals.
If the IPO market gains momentum this year, CFOs will need to work as strategic partners to CEOs and promptly obtain accounting assistance when required. Given financial constraints and other factors, they will need greater flexibility from the accounting industry than ever before. However, it remains uncertain whether traditional accounting firms can deliver this level of flexibility.
While the process of bringing in accounting firms to undertake this type of work is not a new practice, the impact of labor shortages and broader economic conditions may result in delayed or altered outcomes. Therefore, CFOs must adjust their expectations in the current climate, while keeping in mind that the ultimate objective of a successful IPO launch remains the same. It is critical for CFOs not to become disheartened despite potential deviations in the outcome.
Utilize Technology for Flexibility
As companies offer a range of services and technologies to address CFOs' challenges, the ability of finance executives to identify and utilize the most suitable technology at the appropriate time is increasingly becoming a key measure of their competence. The shortage of accountants, escalating labor costs, and budget cuts resulting from economic pressures have created an opportunity for tech-savvy CFOs to leverage the technology market, devise strategies, and execute IPO launches.
Through comparisons of disruptive technology like YouTube, Slack, and Zoom, SaaS products that are currently available have the same potential for disruption in the finance and accounting spaces as these programs had in their respective industries. Technology is highly influential in the IPO launch process and can significantly impact it.
These companies became household names by offering innovative solutions in industries that had not yet been disrupted, providing users with unprecedented flexibility. Until recently, the finance and accounting industries had not undergone such a transformation.
However, a Saas-enabled market network is now making this flexibility available to CFOs, allowing finance professionals to access the talent, tools, and expertise previously guarded by traditional firms.