‘Path to Public’ with Lorrie Norrington

In this video, we sit down with Lorrie Norrington, a Lead Edge Capital Operating Partner with extensive experience advising companies through the IPO process. Lorrie shares her perspectives on the driving forces behind a company’s decision to go public and the key factors a company should consider before taking the leap. We explore the most common pitfalls that can derail the process, the ideal market conditions for a successful IPO, and the misconceptions that often cloud the journey. Lorrie also shares how a company’s culture and leadership play a pivotal role in navigating the IPO process, ensuring that the transition from private to public is not just a financial milestone, but a strategic evolution.

PART ONE: What are typically companies’ main motivations for going public?

• Focus on investment as the most cost-effective from an average cost of capital perspective.
• CEOs are often motivated by providing liquidity for themselves and their employees.
• Going public can increase a company's power with customers and provide staying power in the market.

“Companies see an IPO as a strategic move to increase market power and provide liquidity, which is crucial for both the leadership and employees."

PART ONE: What are the key considerations companies should be thinking about when preparing to go public?

• Preparing for an IPO takes longer than expected, especially in terms of financial audits and compliance.
• It’s crucial to have a team and board that are capable and willing to go public.
• The need for a strategic approach that introduces the subject clearly.

"The IPO process is more complex and time-consuming than most anticipate—having the right team and board in place is essential."

PART TWO: Most common mistakes when preparing to go public

• Companies often overestimate their readiness, failing to reengineer their go-to-market strategy.
• Operations must be consistent, predictable, and scalable.
• A strong product roadmap and experienced team members are essential.

"The biggest mistake is thinking you're ready when your operations and strategy still need refinement for the public stage."

PART TWO: What are the conditions to go public?

• The IPO market needs to be open, with favorable comparables.
• A company should assess competitors’ performance to determine the right timing.
• Run the business with consistency, predictability, and transparency, ideally for 4-6 quarters before the IPO.
• The CEO needs to step back from daily operations to focus on investors and customers.

"Timing is everything—ensure your market conditions are favorable and your business is consistently delivering before going public."

PART THREE: Biggest potholes and mistakes you see along the way

• Understanding the IPO process is challenging because it's a rare experience.
• Bankers won’t handle everything; companies must invest time in getting financials and board readiness in order.
• Ensure the team can sustain the journey over 3-5 years.
• Avoid overextending with too many roadshows, which can dilute the message.

"One of the biggest pitfalls is underestimating the preparation required—both in terms of financials and team readiness."

PART THREE: How does company culture and leadership play a role in an IPO process?

• Begin planning for an IPO years in advance, empowering the company culture so employees understand their importance.
• Foster a culture where employees think like owners.
• Build a board with strong leaders in audit, compensation, and governance, aligned with the company culture.

"A strong, ownership-driven culture and a well-aligned board are key to navigating the complexities of going public."