Thaddeus Swanek Thaddeus Swanek
Senior Writer and Editor, Strategic Communications, U.S. Chamber of Commerce


November 06, 2019


As part of the recently-announced Project for Growth and Opportunity (Project GO), the U.S. Chamber of Commerce is working to help private companies go public earlier — so that Main Street investors, not just traders — reap the rewards.

Over the last two decades, the number of public companies in the U.S. has declined by roughly 50%, and the initial public offering (IPO) market is a fraction of what it was in the 1990s. Public companies historically have been a key driver of growth and job creation, but the decline in IPOs has significant long-term implications for our economy and the financial health of all Americans.

“This is a problem for every American, because for so many Americans their retirement is tied to 401Ks and investments in the markets,” Terry Campbell, vice president of global government relations at Nasdaq, said at a meeting launching Project GO. “And as these companies refuse to go public for longer — or they don’t go public — the ability for 401Ks to capture growth is very limited.”

These days, companies tend to go public after they are already mature and able to handle the legal and other complexities involved with taking a private company public. Given the restrictions in place preventing individuals from investing in private companies, it is often wealthy insiders or investment institutions that benefit, not regular investors or workers at those companies.

It’s an issue that has caught the attention of policymakers on Capitol Hill as well.

“Not every company, not every owner… aspires to go public, but we want to remove any barriers that might exist to that,” Sen. Todd Young (R-Ind.) said. “IPOs provide the prospect of enormous growth, innovation, and the creation of jobs at all income levels. It’s not just individual stock owners that benefit from the creation and success of public companies… Our firefighters, our police officers are vested in pensions that grow on account of public company growth.”

According to Tom Quaadman, executive vice president of the U.S. Chamber Center for Capital Markets Competitiveness, government and corporations both have roles to play in helping private companies go public earlier and stay public.

“For one, the Securities and Exchange Commission (SEC) can help by continuing to implement reforms that make the public company model more attractive to growing businesses and should collaborate with the business community on how to help more households share in the success of American free enterprise,” Quaadman said.

Quaadman cited Intuit as a public company that is spreading the benefits of being publicly-traded more widely, including to rank-and-file employees. Every Intuit employee is eligible for equity grants, including stock options and restricted stock units. Intuit also offers an employee stock purchase plan that allows workers to contribute a percentage of every paycheck to purchase company stock at a discount.

As the company continues to succeed, its employees have a long-term interest in seeing it do well — and stand to profit.

“Companies that are already public can step up by making sure their workers benefit by issuing employees long-term equity incentives in order to align incentives with long-term company performance,” Quaadman said. “Allowing employees to share ownership in the companies for which they work not only increases job satisfaction by creating a sense of ownership, it creates a more productive and successful workforce.”

Moving forward, the U.S. Chamber will report progress on this issue and other proposed Project GO initiatives, which combine real-world business solutions supported by practical public policy.

Read the first article about Project Go here.

About the authors

Thaddeus Swanek

Thaddeus Swanek

Thaddeus is a senior writer and editor with the U.S. Chamber of Commerce's strategic communications team.

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