I’m an undergrad who recently became in interested in entrepreneurship and the startup world. I’m participating in a business competition to help me learn about this kind of stuff because I have no experience in business at all. If anyone could explain this or point me towards some resources, I would really appreciate it. Thanks!
The significance is that everything you do is now under the public spotlight. A publicly traded company is expected to report earnings every quarter. If your earnings and/or profits fall below market expectations, the your stock will most likely drop. As a private company, you do not face the same pressures to increase revenues and profits every quarter.
The reason a company IPO's is because they are in need for a large capital raise, to expand/grow the company. A lot of times, an IPO is planned because it's harder for the company to rise in the private market.
Once you are a publicly traded company, not only do you have the $ raised at IPO, but your access to the credit markets is greatly enhanced. Ie borrowing $, issuing debt, etc. The trade off, is that you are now subject to regulation and the public eye.