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Going Public With Your Startup in Utah

One writer for Forbes is brave enough to tell it straight: the gap between the “instant zillionaires” who build their own companies from the ground up and the painstaking—and legally entangled—process of launching a successful business into the public realm is enormous. A business attorney in Salt Lake City is familiar enough with the “sobering story” the law textbook relates, but the flashy emergence of wealth from garage-and-basement offices like Apple’s story have become the stuff of legend. So which is it? Or is there a middle ground?

Going Public With Your Startup in Utah

Going public can indeed be “messy and expensive,” with hours of time and headaches consumed by filings, disclosures, holds on stock activity, but it may not have to be that way. A business attorney in Salt Lake City that is well-versed in the securities regulations businesses would advise a business to go public only once they’ve reached their ready point, and like Forbes, he would remind CEOs that “it doesn’t have to be an all-or nothing decision between going public and staying private.”

The Securities and Exchange Commission does seem to put a damper on the idea of going public, what with their “arcane process” for registering stocks and bonds, as well as reporting in their infamous EDGAR database. The cost of managing these regulations can be cost prohibitive for a small business with or without the services of a business attorney in Salt Lake City.

But there may be another way. The 2012 JOBS Act, standing for Jumpstart Our Business Startups Act, made raising capital of up to amounts under $1 million through crowdfunding activities online much easier and requires much less reporting. Utah business lawyers familiar with securities law would advise their clients, too, that there are “break points” of $5 million and $50 million thresholds, below which companies can avoid some of the more “onerous registration and reporting requirements” in selling to the public.

A business attorney in Salt Lake City might also counsel a new company to consider selling to investors exempt from many of the reporting requirements, that is, accredited investors (the guys who we think of as “millionaires” and professional investors) and institutional investors. This option lets your company grow before your cousins and their girlfriends want to purchase stock. Fewer is better at first, too—Are there less than 35 investors? You might be able to get the SEC off your back by staying small in your scope, and there is a friends and family exemption in the rule books, so your cousins might be able to get in on the deal more-or-less free of charge (though their girlfriends are an iffy bunch).

All in all, though, securities laws are ridiculously complex, and our bet is that even if you’re a whiz at the business side of things, your head is spinning when you contemplate all the SEC regulations of going public. That’s when you call on a friend—or an attorney—because American laws shouldn’t inhibit economic growth. Don’t let the man get you down.

Free Initial Consultation with a Startup Lawyer

If you are a Utah business that wants to go public, call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States

Telephone: (801) 676-5506

Ascent Law LLC

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About the Author

People who want a lot of Bull go to a Butcher. People who want results navigating a complex legal field go to a Lawyer that they can trust. That’s where I come in. I am Michael Anderson, an Attorney in the Salt Lake area focusing on the needs of the Average Joe wanting a better life for him and his family. I’m the Lawyer you can trust. I grew up in Utah and love it here. I am a Father to three, a Husband to one, and an Entrepreneur. I understand the feelings of joy each of those roles bring, and I understand the feeling of disappointment, fear, and regret when things go wrong. I attended the University of Utah where I received a B.A. degree in 2010 and a J.D. in 2014. I have focused my practice in Wills, Trusts, Real Estate, and Business Law. I love the thrill of helping clients secure their future, leaving a real legacy to their children. Unfortunately when problems arise with families. I also practice Family Law, with a focus on keeping relationships between the soon to be Ex’s civil for the benefit of their children and allowing both to walk away quickly with their heads held high. Before you worry too much about losing everything that you have worked for, before you permit yourself to be bullied by your soon to be ex, before you shed one more tear in silence, call me. I’m the Lawyer you can trust.