The issue of allowing less requirements for smaller companies already took its toll. It was clear that this was going to become a problem. It was better to allow private companies to sell shares than to eliminate requirements based on size. Networking and the elevator pitch have replaced decision making in the last ten years.
For first time there was a compassionate calling to allow smaller companies to do less paperwork. This decision undermined the purpose of the practices without providing a way to meet the requirement.
The main purpose of the paperwork is not for the company to do; it is for the investors to have. They eliminated procedures without satisfying the need that created them.
A successful small company crashed in less than a year of going public without any transparency.
The market is becoming secondary when automated traders have priority, insider lockout periods are flexible, and public companies don't need to report as much leaving investors on their own. Again, it seems the system is forgetting why it was built.
This makes Gross's overreaching statement that equities are dead a lot more credible.
Hologram IPO Holds Lesson for Investors http://on.wsj.com/OjERIQ
