Nasdaq is one of the largest stock exchanges in the world, and it offers three tiers of listing for companies: Global Select Market, Global Market, and Capital Market. Each tier has its own requirements, and companies must meet certain standards to list on a particular tier.
The Capital Market is the lowest tier, and it is reserved for companies with the fewest financial requirements. To list on the Capital Market, a company must have a market value of listed securities of at least $15 million, and at least 300 round lot shareholders. Companies that list on the Capital Market must also meet all of Nasdaq’s listing rules.
The Nasdaq Capital Market has the fewest requirements. Companies that list on the Capital Market must meet the following requirements:
- Market value of listed securities of at least $15 million.
- Round lot shareholders of at least 300.
- Stockholders’ Equity of $5 million
- Unrestricted publicly held shares of 1 million
- Audited financial statements for the most recent fiscal year.
- Unaudited interim financial statements for the most recent quarter.
- Disclosure of corporate governance practices, including its board of directors’ independence, its executive compensation policies, and its proxy voting policies.
- Compliance with all applicable laws and regulations, including those relating to securities fraud, insider trading, and corporate governance.
The tier of listing that a company chooses depends on a variety of factors, including its financial situation, its growth plans, and its investor base. Companies that are looking to raise capital from the public or that are looking to attract a large number of investors may choose to list on the Global Select Market or the Global Market. Companies that are looking to raise a smaller amount of capital or that are looking to attract a smaller number of investors may choose to list on the Capital Market.
No matter what tier a company chooses, listing on Nasdaq can provide a number of benefits, including access to a large pool of investors, visibility to a global audience, and the ability to raise capital. If you are considering listing your company on Nasdaq, it is important to consult with an investment banker or a securities attorney to discuss your options and to make sure that you meet all of the requirements.