Disadvantages of being public
- Less Confidentiality- complete financial disclosure is required to become publicly held.
- More Public Reporting- Reporting expense is greater because of the need for full disclosure.
- Ownership Dilution- Owners give up some equity percent.
- Greater Time Involvement- Management must devote additional time to public company operations.
- Greater Liability- More company visibility brings a higher level of liability exposure.
- Increased Expense- Higher costs of regulatory compliance for audit, legal and investor relations.