Adam Torres and Seth Farbman discuss going public.
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Show Notes:
Why should a company consider going public and when? In this episode, Adam Torres and Seth Farbman, Chairman and Founder of Vstock Transfer and Sharemedia.co, explore the going public journey.
About Seth Farbman
Seth Farbman is a serial entrepreneur with over 20 years of experience in servicing private and public companies across various sectors and industries. He has co-founded and sold three companies in the fields of SEC filings, IPOs, Nasdaq and NYSE listings, corporate services, and background checks, generating significant value for his clients and partners. He is currently the founder of Share Media, a LinkedIn branding agency that helps public and private CEOs leverage the power of LinkedIn to grow their network, influence, and exposure.
He is also the chairman and president of VStock Transfer, a stock transfer agent that provides best-in-class service and cost savings for pre-IPO, Nasdaq, and NYSE MKT listed issuers. He has a deep knowledge of securities regulation and capital markets, having worked as a securities attorney before starting his entrepreneurial journey. He is also a private investor at The Pitch and Surround Ventures. He is passionate about supporting startups, marketing, and LinkedIn, and enjoys sharing his insights and expertise with others.
About Vstock Transfer
VStock Transfer is a stock transfer agent providing best-in-class service combined with a cost savings structure. Founded by lawyers and managed by lawyers to better service companies, counsel and shareholders, VStock offers a unique combination of technology (24/7 online access) and proactive, energetic, personalized and experienced customer service.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest on the show, just head on over to missionmatters. com and click on Be Our Guest to Apply. All right, so today’s guest is Seth Farbman, and he is chairman and founder over at vStockTransfer and ShareMedia.
co. Welcome to the show. Thanks for having me. It’s a pleasure. I’ve heard so much about you and the show I’ve listened to, and it’s great to be here. So we got lots of cover today. We’re going to talk about helping companies on the journey to going public, a lot of business owners, entrepreneurs, and executives that listen to this.
So I’m sure they’re going to get a lot of value as well. I, and I know that you were I know that you were sent over to us or referred over to us by the deal flow guys, Charlie and Phil and his team over there correct me if I’m wrong. I think you were at the micro cap conference. I didn’t get to go, , the other co founder here, Chirag did where you, you were there at the micro cap.
Did you participate? Yep. We were there. We were speaking on sorts of fun topics related to publicly traded companies. We saw you guys there. You guys had a fantastic presentation and panel and yeah, it was a great event. Why, so what keeps you, I always like to get this out there. , what keeps you going back to the deal flow events?
Because I’ve noticed that That like, I’ve done a lot of interviews for them and for their various conferences and the, the speakers, the attendees, the advocates in general, like there’s just quality, it’s quality. What keeps you going back? You know, I think at the end of the day, it’s just a mixture of good people.
I mean, companies you can always find and they have great companies. And it’s just the, , the right I think a combination of the, the issuers And the trade
professionals, the investment bankers , and people that are there to help each other. And I think that’s an important component. Hmm.
That’s great. I yeah, I see it and I hear it and I feel like there’s a real culture around the conferences they put together and people come year after year. And I think people just get tighter. I know, I know business is happening. Cause I hear about it all the time. So good stuff there. So let’s go a little bit further into what you’re doing on a day to day basis, like helping companies go public.
Let’s go. Maybe further back in your career and or journey. Like, , when do you get obsessed with that idea and that concept of helping companies do that? Like, like how’d that start for you? Yeah, it’s a great question. I mean, it’s something that I think about all the time, , my three favorite letters, IPO.
I used to be a securities attorney. Hopefully none of your listeners will hold that against me. And\ ended up running an SEC filing firm in 02, , great story. Started in my basement, slept on my couch, ate pizza for breakfast, lunch, and dinner, and then ended up selling that company five years later.
But at through that journey, we ended up working with about 4, 000 publicly traded companies, which was a great segue for us to enter the stock transfer business which is the stock transfer where. In a different way, as a transfer agent, we are able to provide services to companies that either are public or about to go public, and that’s really where I spend most of my time is seeing how we can assist them at the beginning of that journey through the end.
What are some of the challenges , they face, like in that beginning part of the journey, , like, how does that begin? I don’t know if if only one podcast can cover the amount of time we need to discuss challenges. But no, I mean, I think at the, if we’re talking about these private companies that are looking to explore the IPO journey, I think that number one, they really need to spend some time to get their shop in order.
And that’s not a criticism of them. , they’re typically focused on, how do they grow their business and focused on revenue. And then when it’s time to act as if. You’re a big company. They really need to spend some time with the professionals to get their financials in order and get everything ready for the audit.
And then when it comes to our services, the transfer agent, very often that shareholder list is just, , kept somewhere on Excel sheets. And so there’s a lot of sort of pre work that needs to get done as they embark on a ongoing public. So, why should companies consider going public? And when, like, cause some people will listen to this and maybe they’ve been kind of thinking of going that route, not thinking of going that route.
They’re like, I, it comes up. It’s, I feel like it’s one of those things that come up pretty often. In your experience. And obviously , we’re generalizing a little bit here, but , why should they consider? Yeah, no, , it’s actually a great question , why go public? , and, you know, as somebody , who’s had, thank God, a few exits, people say to me, well, , why don’t I go public?
And, you know, honestly, I half joke to them, well, I know better. No , It’s a couple of variables that people want to weigh. The most obvious reason that people go public is because it’s a great resource to access capital. That’s usually the main reason. But there are other side reasons and, , just to give your listeners some other reasons that the companies are generally considering , is first and foremost, the stock , is looked at as currency.
And so if they have that stock as currency, it gives them a tool to then go ahead and look at different types of acquisitions that they ordinarily would not be able to afford on a straightforward cash basis. , another way to leverage that stock as currency is they can go ahead and.
Expand their team with talent that is far beyond their means without, , warrants or options. And now they can make it really attractive. The other two that I can think of offhand is , by being on the public stage, they have this tremendous platform , on a worldwide basis.
And I think a lot of the foreign issuers come here so that they can use that platform to tell their story. And probably the last one is from a valuation standpoint. You can be at a phenomenal private company, but as a public company, it gives you , perhaps better valuations, more access to certain comps.
And so , there’s a lot of pros to going public and, obviously we can list some , other cons on the flip side. Yeah. One of the things I hear in the media quite a bit as of late and just, I don’t know, last couple of years, of course is, , going public versus crowdfunding versus like other forms of funding.
Like, where do you stand on that issue? Obviously, every company is going to be different, but like just , some thoughts on that, like pros and cons. Yeah, Adam, you hit it right on the head. I mean, I think in today’s environment, some issuers have a couple of choices on, well, now I, I know I do want to go public.
What’s the best way for me? , whether it’s a, a SPAC or a direct listing or crowdfunding, you know, I think the main consideration , or one of the top considerations is that Okay. , crowdfunding means you’re raising smaller amounts of money from a lot of different people. And so, some of our shareholders will have 10, 15, 20, 000 individual mom and pop or individual shareholders.
Man, isn’t that something to think about, Seth? Oh, it, well, imagine our office, you know, answering the phones with those many individuals. And you know, when the company puts out good or bad news, , our phones are ringing off the hooks. I’m cringing. I’m glad that people can’t see this. Cringe for me.
Cringe for me. I am, but, , but that is a tool, right? I mean, so, you know, if you’ve got a product or a, , something that people, it’s like a, a home recognized brand that people want to be part of. And that’s a great way to raise money from the masses, as opposed to doing it through, , one underwriter that’s going to raise you 50 million at one shot.
And , , there’s different ways of going about doing it. Yeah, no. And I see that. there is an indefinitely one of the things that I do like for entrepreneurs in general is that they just, you have options, right? Like you have options you can think about what’s going to work best for you when it comes to like the conversation of okay So now we’re getting to the next step and let’s just say you’re listed what are some of the things that these issuers are These companies should be aware of now like let’s just kind of take them further down the continuum now We’re listed now.
What’s next? Yeah, , I would say two things stand out in my mind. The first is that they have to recognize , and they certainly will recognize this quickly, is that, , now that you’re the CEO of a publicly traded company, you have to wear two hats. And that’s, that’s really two full time positions.
The first is what you’re used to running your company, whether it’s pharma. And then the other hat is now full time PR, and that’s communicating with shareholders and analysts and, , dealing with governance and compliance. And that really occupies an entirely full time job, but except you’ve got to do both now.
So , that’s point number one. And then point number two, I would stress highlight to newly minted publicly traded CEOs is that, You really have to focus on storytelling. I think that , historically, people would put out a press release, hope somebody reads it, and think that their stock is going to trade higher.
And in today’s environment, I strongly encourage people to leverage Social. I mean, whether it’s LinkedIn, whether it’s other forums, they have to storytell, they have to connect to the right audience, and they have to do it consistently, and they have to do it in a way that’s really going to be authentic and let people know what’s going on on a a more ongoing basis, rather than just putting out a press release every couple months.
And doing it as an update as opposed to letting people know, really keeping them involved in your day to day. So those are things that I think that people, , if they can really focus on themselves as being more of a media company, rather than just a widget company, I think they’re going to see some some good results.
Yeah, and this is one of those things where I preach this all the time and I, I love to hear when somebody else comes on the show and says it is I’m like, you know, we kind of don’t have a choice anymore. There was a point in time, maybe 10, 15 years ago where we could have looked at this either social media thing or otherwise and said, but now this is just part of a CEO’s job.
Like you’re not going to be able to, especially just depending the level of the company. I mean, the, More your market cap. I mean the more risk you have and not doing that appropriately But even on the smaller levels like you kind of I believe you kind of many times limit yourself If you don’t have that footprint out there am I off on that?
Like what what are your no, you’re you’re you’re right? I think people are, exactly as you are saying it, people are starting to absorb that and come to terms. I mean, cause it’s real. It’s real money. It’s like, it’s real. Like, it’s really going to affect the stock nowadays. It’s not like just these major stories of this, that even a lack of presence, or presence, that can affect it.
Yeah. I mean, if you think about it, I mean, the average CEO that I would speak to five, five, You know, you mentioned the word LinkedIn and the thing that pops into their mind is that it’s a tool you know, for resumes. And now if you were to meet somebody at a conference or potential investor, potential shareholder, the first thing they’re going to do is Google you and your LinkedIn profile comes up.
And if it’s not, Dynamic and energetic and it has your ticker symbol Then they may not even think that you’re a real company and they’ll swipe and move on So it really is simple But even worse they pull out the phone and they and they try to connect you with you on the spot even worse Right, right Right.
And you’re like, Hey, you’re not really a thought leader, right? I’ve seen people turn red in person and be very embarrassed because the other person’s like, Oh, you’re CEO, blah, blah. And they don’t like expect necessarily, Oh yeah, let’s, let’s connect on LinkedIn. And then the person was like, Oh yeah, I don’t really.
And then the person just gives them this look like, , like what planet are you from? Exactly. I mean, it’s so embarrassing. It’s true. It’s true. That’s the world we live in. So I think that’s a great transition too, because , I did check out share media. So , let’s go further. I do want to bring up the Lincoln a little bit further, cause I see that also what you’re doing over at share media.
co. So let’s tell us a little bit more about that as well. Yeah, I mean, I think it’s just along the lines of what you were saying is that we live in an environment where people have to communicate on an ongoing basis and that although you can go to a conference and meet a few people, if you leverage, if you leverage the digital agency approach, , , you could be meeting targeted people day in and day out , through a company like ShareMedia, we help CEOs and industry professionals Primarily through LinkedIn, and I don’t, I don’t say social media in general, you know, this isn’t about Instagram or TikTok, which, yep, has its place.
This is for professionals. And we live in a world where you can really convey a message and get excited and get your shareholders excited about what you’re doing now. , and really explain to them like, well, here’s why you should be looking at us now. And even, you know, You know, sprinkle in a little bit about this FOMO.
Well, you know, don’t miss out because if you come back to us in six months, here’s what, what we could be doing together. And so we try to help position the messaging, the branding, the connecting. And I think that every CEO could even be doing this on their own, but it’s something that a part of the, the overall packaging of shareholder communication in today’s environment.
Yeah, it makes so much sense , and I mean, to miss the boat on this, you can’t just, and this is my opinion, I’m not putting this on you, but you can’t just catch up when it comes to thought leadership content. Like you can’t just all of a sudden like wake up one day and say, Oh, I want to put out all this stuff.
Cause we don’t have any presence. Like it takes years to build up quality content, like a substantial quality content, not to, I mean, you can’t just, so every year that a CEO. Is letting their profile kind of lay dormant or not doing anything that’s like years where their competition in their same industry and market sector If you know two ceos two different companies the same market same they’re going after the same client Year over year that compounds and you can’t go back in time on google and put out a thought leadership piece or get published in forbes or this or that or wherever else you’re getting published at you can’t do that in retroactively You So if it’s you versus somebody else, like you don’t get to just flip the switch one day.
You got to start somewhere. Like, it’s so true. It’s so true , and even in, , yesteryear, the way of doing it used to be like email marketing and email blasts and things like that, , that doesn’t necessarily work so well in today’s environment. And if you think about it, , if you can build up your connections, but really targeted quality connections, let’s say five, 10, 000, and then you post, you know, two, three times a week about updates and , good content about your industry, , you’re getting, , 000 eyeballs a month on your name, your logo, your positioning, your messaging, your trading symbol, you know, that’s far more, far more effective than the the old school email blasts used to be.
Yeah, and people are watching. That’s the main thing. Like, just like, tell people all the time, like, people are watching. You don’t know they’re watching. They’re watching just like you are. Other people are. , they’re scrolling too, just like you are. That’s it. That’s it. So so you either want to be found or you don’t.
One of the two it’s up to you. Exactly, exactly. Well, Seth first off, this has been a lot of fun. I’m happy that the DealFlow guys referred you over to us for an episode and to really get into that discussion , of going public. I know we scratched the surface on this thing, and I know you have a whole lot more to offer.
That being said, if somebody wants to learn more about vStock Transfer or ShareMedia. co or Connect with you and your team, how do they do that? I’m an open book, so they can just email me directly. Best email is set at V stock transfer. com. And we’d love to answer any questions, any and all things related to you know, pre IPO, IPO marketing and , do my best to add value wherever, whenever I can.
Awesome. And for everybody listening, just so you know, we’ll put the links to , in the show notes, and you can just click on the links , and head right on over to check out SSET’s websites as well. And speaking of the audience, if this is your first time with Mission Matters or engaging in an episode, this is a daily show.
Each and every day we’re bringing out new episodes, new entrepreneurs, new executives, new stories, hopefully new inspiration. If that sounds interesting to you, hit that subscribe button because we have many more shows lined up for you and episodes, and we don’t want you to miss a thing and Seth again, thank you so much for coming on, really appreciate it.
Thank you. Likewise. We’ll be in touch.