Securities Regulation Daily Wrap Up, SEC NEWS AND SPEECHES—Small business advisory panel examines ways to entice businesses to go public, (Apr 28, 2026)

By Suzanne Cosgrove

SEC’s Atkins says one of his highest priorities as chair is to reinvigorate an IPO pipeline that has diminished by roughly 40 percent since the mid-1990s.

Kicking off Tuesday’s meeting of the SEC’s Small Business Capital Formation Advisory Committee, SEC Chairman Paul Atkins told the group that the challenge of encouraging more companies—especially small and burgeoning businesses—to go public is one of the most consequential before the agency.

“Decades of accretive rulemaking, including some at the direction of Congress, have made the path to becoming a public company narrower—and the experience of remaining one encumbered with rules that can introduce more friction than benefit,” Atkins said.

Among companies that do go public, more and more investments tend to be concentrated within the same one or two industries, he added.

“But raising capital through the public markets should not be a privilege reserved for those few ‘unicorns.’” Atkins said, “Today, companies tend not to go public, if at all, until after their Series E round in private fundraising, whereas twenty years ago, an IPO would be the equivalent of today’s Series B or C.”

“Our regulatory framework should provide companies in all stages of their growth—and from all industries—with the opportunity for an IPO, particularly one that represents a capital raising mechanism for the company rather than a liquidity event for insiders,” Atkins said.

Looking for rulemaking. “I am eager for the Commission to propose rules that deliver on my agenda to ‘Make IPOs Great Again,’” Atkins said. “For proposals in the near term, I have instructed our staff to evaluate several ideas that, if proposed and ultimately adopted, could help all companies—but especially the smaller ones—in going and staying public. These ideas build on concepts that have proven successful and aim to spread that success to more companies.

For example, a regulatory IPO “on-ramp” that does not automatically terminate five years after a company becomes public may provide more certainty to smaller companies—and encourage them to stay public, Atkins continued. Providing nearly all small public companies with full access to “shelf registration” would allow them to tap the public markets quickly and when conditions are ideal. Giving companies the option to file their regulatory reports quarterly or semiannually also affords flexibility based on their industry, business model, and investor expectations”, he said.

Data illustrates challenges. Committee member Rose Stadifer, partner at Foley Hoag LLP, Denver, cited a series of data that backed up Atkins’ stated concerns. She noted $1.5 trillion was raised from investors in the public markets last year, while $840 billion was raised from investors in the private markets. “This is something to keep in mind that there is significant capital available for companies in those public markets,” she added.

The challenge of going public is particularly acute for small companies, noted SEC Commissioner Mark Uyeda. “Data from today’s Committee agenda indicates that small companies made up 44% of 2024 IPOs but raised only 3% of the capital,” he said. “That disparity suggests that while small companies are still attempting to access the public markets, the economics may be broken.

“Fixed compliance costs, underwriter economics, and a regulatory framework calibrated for large issuers make it extraordinarily difficult for small companies to raise meaningful capital through a public offering,” Uyeda said. “The result is a public market that is increasingly the domain of large, late-stage companies—and a shrinking opportunity set for investors who want to participate in earlier stage growth.”

Why does it matter? “Vibrant public markets … allow everyday investors, not just institutions and private funds, to participate in the growth of innovative companies. They create liquidity for founders and early employees,” said Marcia Dawood, the committee’s chair and venture partner at Mindshift Capital in Charlotte, N.C.

“I believe we should focus on making the public markets work again for smaller companies, where the benefits outweigh the risks. To do that first, I would support what could be called an IPO light pathway for companies of a certain size threshold,” she said.

“If a company has modest revenues, a smaller market capitalization and a straightforward business model, it should not face the same regulatory architecture of a mega cap multinational, and that could mean scaled disclosure requirements, shorter registration documents, simpler executive compensation disclosure, more streamlined internal control requirements in the early years, and reduced filing burdens while the company grows into a full public company status,” Dawood said.

Drawing up a to-do list. While the committee did not adopt a formal reaccommodation for the Commission at Tuesday’s session, committee members drew up a list of considerations to take up at their next meeting, slated for July 21.

High on the committee’s to-do list was “de-risking” deal execution, reducing the costs of going public and its associated compliance measures, and reducing or eliminating the time from the current 15 days waiting period from when a company files its registration statement (Form S 1) and when it can begin marketing its shares to the public.

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