Strong Criticism for IPO On-Ramp: A Wall Street Journal article on House passage of the JOBS Act (“Jobs Bill Loosens IPO Regulations,” March 8, 2012) documents broad opposition to the bill’s so-called IPO On-Ramp. Industry data shows that all but a handful of IPOs would qualify for the bill’s exemptions from basic financial reporting and corporate governance requirements. The article quotes Kathleen Shelton Smith, a principal with IPO research and investment management firm Renaissance Capital as saying that the bill essentially “covers the entire IPO market” and needs to be scaled back. Lise Buyer, founder of Class V Group LLC, a firm that advises companies who are planning IPOs, warned that, “Making it easier to list on a stock exchange won’t necessarily attract the IPO investors who are supposed to boost firms’ capital and spur job creation.” The article quotes Shelton Smith and others pointing out that “investors, who remember getting burned by early-stage Internet stocks in 2000 and who lost money during the 2008 economic crisis, are cautious about buying shares in unproven companies.”
