SEC Seeks Ways for More Companies to Go Public

Federal securities regulators are exploring ways to encourage more companies to go public.

To that end, the Securities and Exchange Commission’s Small Business Capital Formation Advisory Committee said it will hold a meeting this month to examine “ways to modernize public market access and encourage [initial public offerings (IPOs)] and small public company capital formation,” according to a Wednesday (July 8) press release.

“Building upon ideas generated during the prior committee meeting, members will continue exploring ways to encourage more companies to go and stay public,” the release said. “The committee will consider ways to modernize the IPO process and potential regulatory reforms, including certain recently proposed SEC rulemakings aimed at reducing regulatory friction and facilitating capital formation in the public securities markets.”

The meeting, scheduled for July 21 at 10 a.m., will be open to the public and held at the SEC’s headquarters in Washington, DC. It will stream live on SEC.gov, according to the release.

The announcement came as the SEC pursues what Chairman Paul Atkins has called the regulator’s “Make IPOs Great Again” initiative.

“Every IPO is an invitation to workers and savers to participate in the prosperity of the next generation of American enterprise,” Atkins said in a Tuesday (July 7) statement announcing the commission’s regulatory agenda for the year. “When fewer companies go public, fewer investors receive that invitation.”

Among the amended rules floated by the SEC is a proposal to raise the threshold for a public company to become a “large accelerated filer,” a status that requires more stringent reporting rules, from $700 million to $2 billion, according to a May 19 press release.

“A company would not become a large accelerated filer for at least 60 months following its IPO regardless of its public float, effectively providing it an ‘IPO on-ramp’ to stabilize and grow while benefiting from disclosure scaling and other accommodations,” the May release said.

The regulatory agenda also includes proposed rules that would clarify the framework around crypto assets. Atkins said these proposals are designed to promote innovation and new technology.

“To deliver on President Trump’s goal to ensure that the United States is the crypto capital of the world, we are embracing innovation to bring more products onshore, creating clear rules of the road for capital raising with crypto assets, and providing clarity as to how market participants can custody and facilitate trading of tokenized securities on-chain,” he said in the Tuesday statement. “All while ensuring strong investor protection guardrails are in place and continuing to pursue bad actors who violate the law.”