Business

Strengths of Utilizing IPOs
The use of an IPO by Riordan Company is indeed a prudent consideration in the modern days considering the extent to which the internet has revolutionized modalities of performing businesses. If the company has fulfilled all legal requirements necessary for public listing, like those contained in Sarbanes-Oxley Act, there are several strengths it would have by using an IPO. First, IPOs have a massive potential for generating capital considering that investors are required to buy shares which require minimal financial investment.  Once, the company goes public, the shares traded increases the liquidity of the company since they have a market value and can be exchanged instantly for liquid money (Benton, 2009). This is an advantage to both the investors and the company who may need to dispose their shares to attend to immediate needs. In addition, an IPO would increase the prestige of the virtual company. The process of going public attracts a lot of attention which is good in marketing the name of the company. Also, IPOs improves the companys worth through valuation. The share values are determined by market demands and as such, the virtual company would overcome the limitations associated with private valuation. Also, going public would help the company owners to acquire more wealth since the shares generate revenue for both the company and the shareholders. As long as the shareholders have not disposed the shares, it remains a liquid capital for the company.
Strengths of Acquiring Another Company in the same Industry

One of the most fundamental considerations in business expansion is the need to devise strategies that can effectively tackle competition. By acquiring other companies in the same industry, the virtual company would be able to eliminate competition and instead focus on increasing sales volume to the consolidated market. Also, the companies would pull together their operational capital and resources which can be utilized in implementing growth strategies such as looking for new markets (BNET, 2009). In addition, the pooling together of human resources from the two companies increases the innovation base which may help the companies to diversify to new products which may effectively address the tastes and preferences of customers. Also, acquiring another company in the same industry would increase the pricing power for the supply chain. For instance, a company that acquires one of its suppliers is able to benefit directly from the profit margins that the supplier was adding to the costs. This way, the company can be able to reduce its production costs and transfer the better prices to customers which would help give the business a competitive advantage over its competitors.

Strengths of Mergers
The virtual company can adopt a merger strategy with a company which offers a complementary service to itself.  One of the fundamental strength associated with mergers is the increase of synergy in the business. Mergers are able to pool different resources, both physical and human, towards achieving a similar objective. This helps in increasing performance through a pooled workmanship and also reduces costs by taking advantage of diversified profit margins (BNET, 2009). In addition, merging may help the company to distribute its risks from one industry to the other. For instance, if an electronic company merges with a telecommunications company, the company would be able to tap the advantages of both low and high seasons in both industries. Also, mergers would help the companies in product diversification. For instance, merging two brands of a product and selling them under the same company would ensure that customers find different and diversified products in the same companies.  This would ensure that the company effectively caters for the requirement of new products by customers which is essential for their retention. In addition, mergers promote growth through the consolidation of capital as well as overshadowing their competitors efforts which helps in reducing competition.