What is a direct listing?
Direct listings have increasingly been gaining attention as a
means for a private company to go public. A direct listing refers
to the listing of a privately held company's stock for trading
on a national stock exchange (either the NYSE or Nasdaq) without
conducting an underwritten offering, spin-off or transfer quotation
from another regulated stock exchange. Under current stock exchange
rules, direct listings involve the registration of a secondary
offering of a company's shares on a registration statement on
Form S-1 or other applicable registration form filed with, and
declared effective by, the SEC.1 Existing shareholders, such as
employees and early-stage investors, whose shares are registered
for resale are able to sell their shares on the applicable
exchange, but are not obligated to do so, providing flexibility and
value to such shareholders by creating a public market and
liquidity for the company's stock. Upon listing of
