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Private Traded Company VS Public Traded Company - Coggle Diagram
Private Traded Company VS Public Traded Company
Private Traded Company
Definition
A privately held company is a business that’s entirely owned by one or more of its founders. These companies are not publically traded on a stock exchange and can only be privately sold to shareholders at their own whim.
Advantages
Full Control over the company
Difficult to take over
Less reporting requirements
More Flexible
Doesn't have to appeal to shareholders
Disadvantages
Less capital resources
Less liquidity
Personal Finance Liability
Examples
IKEA
LEGO
Features
Exclusive ownership
Full Decision-making power
No shareholders to please
Public Traded Company
Definition
Publicly Traded Companies, also known as publicly listed companies, refer to all those companies which have their shares listed on any of the stock exchanges which allow the trading of their shares to the common public, i.e., anyone can sell or purchase the shares of these companies from the open market.
Examples
Google
Apple
Tesla
Advantages
Easier to exit out of.
Raises money for large scale projects easily
Liability is only within the company.
More growth opportunities
Disadvantages
Vulnerable to takeover
Focuses more on short term profits.
More transparency required
Has to please shareholders
Features
Offers shares to the general public
Has limited liability