Patrick Lucchese, a prominent urban strategist and entrepreneur, and one of the co-founders of Urban Advisors, shared his extensive experience on how family-owned enterprises can successfully launch an initial public offering (IPO) in a 2019 interview with Tech Times. As a well-known consulting company, Urban Advisors offers specialized urban planning and real estate services to both private and public sector clients since its inception in 1999 by Lucchese and his two other partners, Eric Rothman and Lenny Goldstein. Their portfolio ranges from affordable housing development to public space revitalization.
Lucchese emphasized that family businesses should be meticulous in their planning and preparation for an IPO as many of them are not familiar with the necessary transparency and disclosure level required for public companies. They might need to modify their management and operations significantly to satisfy regulatory requirements.
He states, “Going public is a considerable feat for any business, especially for family-owned ones. Solid planning and readiness for the additional scrutiny and reporting required by public companies are essential.”
One of the critical challenges that family businesses encounter is the transition from being a family-run operation to a publicly traded company. Lucchese underlined the importance of establishing a robust management team that could steer the company through the IPO process and beyond.
“As a public company, family businesses must be prepared to cede some control and enlist external expertise to succeed. They may need to recruit new executives or directors, or spend in systems and processes to ensure regulatory compliance,” he added.
Moreover, family businesses must evaluate their financial and operational performance carefully before an IPO. Investors meticulously scrutinize a company’s financial statements and performance metrics, and family businesses may need to invest in systems and processes to ensure accurate and transparent reporting.
Lucchese said, “Transparency is the key to going public. Family businesses should guarantee that they have precise financial reporting and operational metrics in place and are ready to disclose this information to potential investors.”