Resesrch into the Causes of Low Interest of Czech Companies in Financing Their Development through IPOs

Funding development of the company through the „Initial Public Offering“ has a high representation globally, the Czech Republic unlike, and belongs to traditional methods of raising funds necessary for development of business in the developed capital markets. Without the possibility to obtain the capital by this way the global financial system, the economic system alike, would be of a quite different shape than nowadays. In the United States of America, Japan and in the Western Europe countries the method of company funding through IPO has been applying for several decades already. The first public stock offerings began to be applied in these markets in higher volumes from the beginning of the 60th of the last century. From that period importance of IPO goes up globally and the initial public stock offerings begin to be applied more and more even in the Central and Eastern European countries. Under the conditions of the Czech capital market this way funding of development of the company, connected with its entering into the capital market, is not very usual. The Strategy of Sustainable Development of the Czech Republic considers this situation the weakness of the Czech economy, and its resolving has to be paid a due care. The paper presents the findings of a primary research that focused on identifying the causes of the low interest of Czech companies in financing their development through initial public offerings. The primary research that was quantitative in its nature was conducted using questionnaires addressing a sample of companies, which, in the investors´ understanding, might be considered as prospective candidates for IPOs. The research was carried out as part of my PhD thesis that focused on the issue of IPOs on the Czech capital market.