17. Listed/Publicly-Traded (definition)

NOTE: if you’re new to Ground-Up Governance, or are finding anything a bit strange or confusing, you might want to START HERE.

Let’s imagine that you think Reallie Steilish Inc. has the potential to be really good, but you need more money to take it to the next level. One way to get money is to sell your shares in a “store” where basically anybody can buy them. First, what you need to do is hire some really nerdy people take a super close look at every aspect of your corporation and business so that they can do some math and decide how much money your corporation is worth, and by extension how much money you should get for each share you sell.  If your company is worth $100 and you want to sell 1000 shares that represent half of your company ($50), then you will get five cents for every share you sell. Even THAT was pretty complicated, so you can imagine how crazy these things can get. Afterward, you put up your shares for sale in the “store” and people can buy and sell them to each other all they want. And the better your corporation is, the more money they can get when they sell shares. After you sell your shares through the “store” your company is “listed” or “publicly-traded” because the general public can trade your shares with each other.

That’s the good part. The less good part is that when you’re publicly-traded you get a new duty to tell the public a lot of things about your corporation. There are a couple of reasons why this isn’t great. First, you might feel like some things are nobody’s business but yours – not because those things are bad, but you’d just rather not talk about it.  Like having an awesome mole on your leg in the shape of the Canadian province of New Brunswick: it’s not embarrassing (it’s awesome), but when people find out about it they get distracted from all the stuff you REALLY want to talk about, like your quirky yet disarming smile. Anyway, you might have to disclose the corporate equivalent of your New Brunswick mole to everyone in the world, distracting people from the things you think are really important.

The other downside to telling the public about your corporation’s mole is that it costs a lot of money to spread the word to your shareholders! Someone has to write, design and send out reports, emails, snail mails, web pages, and more! And before you can even do that, you have a duty to pay an impartial expert (someone like Captain Taxtastic) to take a really close look at that mole just to prove that it really is a mole and not a callus or a spider bite or some kind of fraudulent temporary tattoo that you’re trying to pass off as real. All that plus the cost of communicating the authenticity of your mole story in a way that all shareholders can access and understand and empathize with. Sounds annoying, right?

Definitely annoying! But it might be worth it for your corporation to go through the whole ordeal anyway. I mean, where else are you going to get that fifty bucks?