➥A practical on-ramp to public trading ➥

For many small businesses, an OTC Markets listing is a faster, more cost-predictable way to establish public trading and disclosure discipline—either as a direct listing or via reverse takeover (RTO) of a public shell. PBM coordinates the workstreams so your team can stay focused on the business.

 

Two Main Paths

⭕ Direct Listing on OTC Markets

A direct listing (often paired with an S-1/F-1 resale registration) enables existing shareholders to have eligible securities quoted for public trading by a market maker on OTCQX/OTCQB/Pink. There is no underwritten IPO—you’re creating a public market for already-issued (and properly registered/resellable) shares.

 

Typical advantages

◑  Generally lower upfront cost and simpler than a traditional IPO

◑  Potentially faster to trading once filings are effective and a market maker files Form 211

◑  Control your capital plan (you can add a primary raise later if appropriate)

 

Watch-outs

◑  You still need clean financials, governance, and disclosure discipline

◑  Liquidity depends on investor awareness and market maker support

◑  Tier eligibility (OTCQX/OTCQB/Pink) drives disclosure expectations—choose carefully

 

⭕ Reverse Takeover (RTO / Reverse Merger)

An RTO combines your private company with a public shell, resulting in the private company’s shareholders controlling the public entity—hence “reverse.” RTOs can achieve trading more quickly than building from scratch, but require intense diligence on the shell (liabilities, cap table, legacy obligations).

 

Typical advantages

◑  Calendar speed when a suitable shell is available

◑  May reduce the number of pre-trading steps the private company must complete

 

Watch-outs

◑  Shell diligence (legal, financial, cap table) is critical; legacy risks can linger

◑  Post-merger, you still need governance and internal-control uplift

◑  Name/stock symbol/corporate actions and disclosure catch-up can add complexity

 

Which Tier Fits? (High-Level Overview)

◉ OTCQX — Highest OTC tier; stronger eligibility and disclosure standards; best for mature small businesses with solid governance.

◉ OTCQB — Venture-stage tier with ongoing reporting and governance requirements appropriate for growth companies.

◉ Pink (Current Information) — Basic disclosure status; lowest bar to enter public trading, but also lowest investor expectations.

💧Your tier choice affects disclosure cadence, advisor needs, and investor perception; PBM helps you map requirements to your stage and resources.

 

PBM’s Role (Advisory-Only, Hands-On)

◉ Program Management: Charter, timeline, RACI, risk log; vendor stack coordination (counsel, auditor, market maker, transfer agent, IR).

◉ Governance & Controls: Board/committee charters, Code of Ethics, related-party policy; COSO-powered “SOX-Lite” controls sized for small teams; DC&P-lite cadence.

◉ Disclosure Readiness: Drafting calendar, responsibility matrix, MD&A/KPI data map; comment-response tracking.

◉ Cap-Table & Data Room: As-converted waterfall (FDSC), option plan basics; audit-ready data room with tie-outs and evidence index.

◉ Form 211 & Tier Workflow Support: Prepare packages for the market maker and OTC Markets tier application; manage checklists and follow-ups.

◉ Post-Listing Rhythm: Quarter/annual cadence, sub-certifications, KPI dashboards, and investor-readiness basics.

💧Compliance note: PBM is not a law firm, CPA firm, or broker-dealer. We do not underwrite, solicit, or place securities, and we do not handle client funds. We coordinate with licensed attorneys, PCAOB auditors, transfer agents, market makers, underwriters of record, and IR firms as needed.

 

🔴 Trademarks & Attribution

OTCQX and OTCQB are service marks of OTC Markets Group Inc. References are for descriptive purposes only. PBM is not affiliated with or endorsed by OTC Markets Group.