Direct listing: go public without a shell or investment banker.
The route where nobody has to say yes.
Register your shares with the SEC, get them quoted and become a public company, with no underwriter, no shell and no investment bank deciding whether you can go. Follow the process and fund it properly, and the outcome is in your hands.
Joel Arberman has taken 17 companies public, several of them his own, and 11 of them by direct listing.
The short version
This page is for founders deciding whether becoming public, at a specific point in time, would improve the trajectory of their business. The real question isn't which listing method to use. It's whether operating as a public company instead of a private one changes what your business can do.
Who it's for
Most often, companies that aren't yet a fit for a traditional IPO but would benefit from operating as a public company.
Time and cost
About nine to ten months, funded in stages. It starts with The Four Levers Program: a written plan for $10,000, fixed, with nothing owed after. If you go on, Raise-Ready is $15,000 fixed, and the listing itself is on a monthly fee plus equity, agreed in writing before it starts.
The real benefit
Not the listing itself, but operating within a public-company structure. Over time it can improve access to capital, talent and opportunities, and speed up growth compared with staying private.
What it takes
It's execution-driven. Companies that finish and get value from it tend to have enough initial capital, are ready for reporting requirements, and treat the listing as the start of a longer strategy, not the end.
What a direct listing is
A company registers its shares and becomes publicly traded without an underwritten offering or a reverse merger. That means:
- No investment bank pricing and distributing new shares
- No requirement to raise capital at the time of listing
- No public shell
- No dependence on a third party agreeing to sponsor the deal, or on institutional demand at a particular moment
Follow the process correctly and the main variables are your preparation, your capital and the regulators' review of your filings.
Why companies choose it
Most companies pursue a direct listing because a traditional IPO isn't available, or isn't available on acceptable terms. Usually the company is earlier in its development, works in a sector investors don't currently favor, or doesn't fit what investment banks and institutional investors will support at the time.
A direct listing lets you go ahead regardless of investment banker interest. Instead of reshaping the business to meet outside expectations, you meet the regulatory requirements and move on your own timing and goals. Any company that has the capital in place and follows the process can go public via direct listing.
What changes when you become public
Going public changes how the company is seen and how it can operate. The first change is financial transparency: once audited financial statements and periodic disclosures are in place, outsiders can judge the business on standardized information. Less uncertainty means more willingness to engage, and that carries through:
Investors
Investors who wouldn't engage with a private company may be willing to evaluate a public one.
Lenders
Lenders are often more comfortable underwriting risk when they get ongoing disclosures.
Partners
Potential partners can assess the business without relying only on what management tells them.
Senior hires
Candidates can better understand what they're joining, especially when equity is part of the pay.
Equity you can use
Publicly traded stock is more usable for compensation, advisory relationships and, in some cases, acquisitions. It doesn't automatically work as a currency the way many founders assume, but it gives you a reference point a private company doesn't have.
Capital over time
A direct listing doesn't raise money at the outset, but you're no longer limited to your existing network. As credibility builds, more capital can become available, often on better terms than before the listing.
Over time, the set of relationships open to you grows. These changes don't happen immediately or evenly. They build as the company shows consistency in reporting, communication and execution. The effect is cumulative, not instant.
A structural change, not a one-time event
Seen as a one-time event, a direct listing looks limited: no underwriting support, no coordinated distribution and no capital raised in the transaction itself. Seen as a structural change, it looks very different. The company moves into a framework where transparency, credibility and access are materially different from private life, and it can use that framework for years.
Companies that use it well tend to work in sequence:
- Establish credibility through consistent reporting.
- Expand relationships with investors and counterparties.
- Raise capital when conditions are right.
- Use that capital for growth that would have been harder to execute as a private company.
The listing doesn't create those opportunities on its own. It makes them more accessible.
Give it time
Don't judge a direct listing by immediate results. The first period after listing is about baseline credibility: meeting reporting requirements, getting to know your shareholder base and showing operational consistency. As that foundation develops, the company can engage more broadly, raising capital, expanding relationships or pursuing transactions that need more transparency. The timeline varies by company, but the pattern holds: the benefits grow the longer you operate as a public company.
Timeline, cost and how it is funded
- Timeline About nine to ten months from first preparation to completion. Audit readiness, your organizational structure and how quickly materials come together can move that, but it's a reasonable planning number.
- What it costs The legal, audit, accounting and advisory work needed to prepare the company and complete the listing. Third-party costs for a direct listing typically run $300,000 to $500,000, paid directly to those providers, and the full cost is not needed upfront. You don't need this money sitting in the bank. In almost every case, the private placement is structured so you and your team can raise capital from your personal and professional networks to cover these costs, often with growth capital on top, and sometimes capital for acquisitions too. Your own outlay is the plan and the preparation. The people who already know you pay for the rest.
- Step 1: The Four Levers Program, $10,000 fixed Four one-to-one working sessions and a written playbook, about 30 days: whether a direct listing belongs in your plan now, later or never, which market to list on, your first raise outlined, and a 90-day action list. Nothing owed after. Read about the program.
- Step 2: Raise-Ready, $15,000 fixed If the plan calls for a raise, we prepare the company and coach you through it, with 90 days of support. You and your team raise from your personal and professional network. That money funds the costs of going public, plus working capital and early growth. If the raise falls short, you can stop there and owe nothing further.
- Step 3: The listing With capital and shareholders in place, we manage the listing and coordinate the auditors, securities lawyers, transfer agent and other specialists, on a monthly fee plus equity agreed in writing before it starts. Advisory work after the listing is also monthly plus options. You can stop after any step.
Where investment banks fit
Investment banks don't raise this initial capital. In this context they don't fund or distribute financings for companies before they list. Their involvement, when it comes, comes later.
Meaningful interest from bankers usually takes traction: typically a few million dollars raised, progress shown over time, and enough time in the public markets to build credibility with investors. Based on observed patterns, that point is often reached about two to three years after the process begins, depending on execution and market conditions. At that stage, we can identify investment banking firms whose investors may be interested in your company, and facilitate introductions and coordination.
There are exceptions. Companies with more traction, in sectors investors currently favor, with more developed teams, may reach institutional capital sooner, and deals with third-party capital can sometimes be structured earlier. Even then, raises through investment banks are usually more practical once the company has listed or is close to listing, not at the very start.
The pattern is consistent: early capital comes from the founder and their network. Later capital becomes available once the company has shown progress and credibility in the public markets.
Process certainty
A direct listing doesn't depend on market receptivity the way an IPO does. No institutional demand is needed to support a deal at a specific valuation, and there's no underwriting that can be withdrawn when markets or investor sentiment change.
Once the company meets the regulatory requirements and completes the preparation, the listing can proceed. The main risks are internal, not external: preparation, capital and execution, rather than whether a third party is willing to move forward.
Unlike an IPO, no underwriter or investor decides whether you list. When the process is properly followed and adequately capitalized, what remains is regulatory review of your filings, and that follows published rules.
Why most smaller companies should start on the OTC market
A Nasdaq listing brings requirements the OTC market does not: board committees, paid independent directors, directors' insurance, and higher legal, audit and listing fees. In our experience the difference can be half a million to a million dollars a year or more. A smaller company can rarely carry that.
There is also the question of timing. A company that lists early, at a modest valuation, has years to build value with the four levers. A company that waits, raises round after round at higher prices and then lists is asking the market to support a valuation it has not earned.
If you're building it, it holds. If you're inflating and you list, it pops.
Life after listing
After listing, the company operates under a different set of expectations. At a minimum that means periodic reporting, disclosure obligations and governance requirements. They're ongoing and can't be deferred.
More broadly, management decisions are judged in public, which affects how you approach capital allocation, communication, hiring and strategy. Some companies use this environment to expand what they can do. Others find it restrictive. The difference usually comes down to preparation, and whether management treats the public structure as a tool to use or a status to maintain.
Our role
A direct listing involves several parties, each responsible for one piece of the process. What often goes unaddressed is how the pieces fit together, and how decisions made along the way affect the company after it's public. We provide that continuity:
- Evaluating whether the structure is right for your company
- Sequencing the process so costs and commitments track progress
- Coordinating your service providers
- Spotting issues before they become obstacles
- Preparing management for life after listing, where most of the outcomes of being public are decided
Our perspective comes from taking companies public through direct listings, reverse mergers and IPOs. Engagements are built for ongoing involvement, not a one-time transaction. Work starts before the listing and usually continues well after, often for an extended period, because most of what going public delivers is determined after the listing, not at it.
It starts with a written plan for a fixed fee, with nothing owed after. If you go on to list, we’re paid a monthly advisory fee plus equity, agreed in writing before each step starts. The monthly fee supports the ongoing work of preparing for and operating as a public company. The equity aligns our incentives with yours over time. The value of the engagement isn’t tied to completing a transaction. It’s tied to whether you use the public structure to build a larger, more valuable business.
Is a direct listing a fit?
A good fit if you
- Are actively building and plan to keep building, rather than looking for near-term cash or liquidity
- Believe operating as a public company would improve your ability to raise capital, recruit or pursue opportunities that are hard to reach today
- Are willing to raise the initial capital, typically from your personal and professional network
- Are ready for the ongoing reporting and governance requirements of a public company
- Are responsive and execution-oriented, and see the public platform as a tool rather than a milestone
Probably not a fit if you
- Aren't in a position to raise initial capital
- Aren't prepared for ongoing disclosure and reporting requirements
- Are focused mainly on the listing itself rather than what happens afterward
The goal isn't a listing for its own sake. It's deciding whether becoming public, at a given point in time, improves your company's ability to build a larger and more valuable business, and structuring the process around that answer.
Raising the capital first
Every direct listing starts with a private raise, usually from your own network, and we prepare you to run it: the story, the numbers, the offering documents and the outreach plan. Some founders also raise through Regulation Crowdfunding or Regulation A+, which can bring customers and employees into the shareholder base you take into the listing.
When it makes sense to reach out
It's worth talking when you're seriously weighing whether going public could speed up your ability to grow, raise capital, recruit or pursue opportunities that need more credibility and visibility. It's especially relevant if you're not a fit for a traditional IPO today but would benefit from being public, and you have, or believe you can raise, the initial capital to begin.
A first conversation isn't a commitment to move forward. It's to decide whether the structure fits your situation, constraints and goals. Send a short form with basic information about your company, and we'll see whether a conversation makes sense.
One last thought. A direct listing's defining feature is that it doesn't depend on an underwritten offering or approval from an investment bank. For some companies that doesn't matter. For others, it decides whether, and when, going public is possible at all. So the real decision isn't whether a direct listing is available. It's whether operating as a public company, starting now rather than later, opens up enough opportunity to justify the costs, requirements and obligations.