If your business is looking to raise funding from the public and to raise public awareness, which of the following fund raising options is suitable ?

Question

BlackTom AI · Accepted Answer

In evaluating fundraising options, it’s important to match the method to the goals of public fundraising and public awareness.
Option 1: IPO. Going public through an initial public offering is specifically designed to raise capital from the public markets and to increase public visibility and credibility for the company. This route typically attracts a broad base of investors and can generate significant press attention, which aligns with the dual aims of funding and awareness.
Option 2: Right issue. A rights issue is offered to existing shareholders to raise additional capital from current owners. While it can be a cost-effective way to raise funds, it targets existing shareholders and does not primarily serve to attract new public investors or maximize broad public awareness beyond the current investor base.
Option 3: None of the option here. This choice would be chosen only if none of the listed strategies fit the goals. Given that an IPO clearly targets both public funding and visibility, this option would be inaccurate in this context.
Option 4: Private placement. Private placements involve selling securities to a select group of institutional or accredited investors rather than the general public. This method is geared toward targeted investors and typically does not maximize public awareness or accessibility to the general public, which is contrary to the stated goal.
Thus, when the objective is to raise funding from the public while also boosting public awareness, the IPO stands out as the option that best satisfies both aims. The other choices either focus on existing shareholders, selective investors, or do not address public visibility in the same broad way.

BFIN011 Week 9 Online In-class Assessable Quiz - 45 minutes |LA003- Requires Respondus LockDown Browser

If your business is looking to raise funding from the public and to raise public awareness, which of the following fund raising options is suitable ?

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