The Leap to Public Markets: Insights from Palm Beach CorpGov Forum

Navigating the transition from private equity (PE) to public markets can be a daunting task, but with the right strategies and insights, companies can successfully make the leap. The fourth annual Palm Beach CorpGov Forum, held on Nov. 13-14, 2024, provided valuable guidance for PE firms planning to go public. The forum featured panels, firesides, and networking receptions, attended by over 200 institutional investors, family offices, attorneys, investment bankers, and key advisors.

One of the key takeaways from the forum was the importance of understanding the regulatory differences between private and public markets. Private companies enjoy less stringent reporting requirements, but public firms must comply with the Sarbanes-Oxley Act (SOX), which can lead to higher costs and potential operational challenges. To navigate this, firms should assess SOX compliance costs, data security, and communication strategies early on.

Effective pricing strategies are also crucial for IPOs of previously PE-owned companies. The forum emphasized the importance of understanding the company's unique value proposition and being flexible in pricing. Starting with a higher price and adjusting downwards if necessary, while ensuring effective communication of the company's story and value to investors, can help achieve a successful IPO.

Adapting governance structures to meet public market expectations is another critical aspect of the transition. PE firms must implement robust ESG practices, enhance disclosure standards, and foster a culture of long-term value creation. This includes transparent, accountable, and independent board composition, aligning with public company governance standards.

The panelists, including Mark Meltz (former COO and General Counsel, Kinnate Biopharma), Jim Palmiter (CEO, DragonGC), and Tad Nacheff (Head of Financial Sponsor Coverage – Capital Markets, NYSE), shared insights from their experiences in transitioning PE firms to public markets. Their advice emphasized the importance of a strong management team, a compelling investment thesis, and understanding the unique dynamics of public markets.



The panelists also anticipated specific challenges and opportunities for attendees, such as the need for robust financial planning and disclosure, a compelling narrative, and choosing the right moment to go public. By strategizing their listings, attendees can ensure they meet regulatory requirements, present a compelling investment case, and maintain strong shareholder relations.

In conclusion, the Palm Beach CorpGov Forum provided valuable insights and guidance for PE firms planning to make the leap to public markets. By understanding the regulatory differences, implementing effective pricing strategies, adapting governance structures, and learning from the experiences of industry experts, PE firms can successfully navigate the transition and thrive in the public market landscape.