The capacity to raise share capital by a public issue of shares is the most obvious benefit of a Public Limited Company, especially when the company is listed on a reputable stock exchange platform. The amount of capital that can be raised is often substantially more than that of a Private Limited Company, where the sale of shares is completely restricted on public platforms. Other than the general public, contributing to the funds of a Public Limited Company on the stock exchange platforms are institutional investors such as mutual funds, hedge funds, and other traders which are also listed on these platforms.
A company must have at least 7 shareholders who have bought its shares in order to get incorporated as a Public Limited Company. However, there is no maximum limit on the number of shareholders that the company can sell its shares to. Moreover, a Public Limited Company not only sells its shares to institutional investors but also to the general public, for which it is listed on publicly accessible stock exchanges platforms. This indicates that a Public Limited Company has the most diverse range of owners or shareholders, and the risks that the company would face in the due course of operations shall be widely distributed between all these shareholders. Contrarily, there are business structures where the adverse risks burden the only owner, or a few number of owners of the business only.
Companies which usually adopt a Public Limited Company as their business structure conduct large scale operations and hence, have huge potential for growth and expansion. This makes it easy for a Public Limited Company to raise funds not only in the form of equity / share capital, but through multiple other channels like credit from banks and financial companies, bonds, debentures, crowdfunding, etc.
Moreover, the fact that it has its own legal identity and can be listed on stock exchange markets, makes it more credible and reliable for investment. Additionally, the business might be better positioned to negotiate advantageous interest rates and loan payback arrangements.
Having a Public Limited Company as the organizational structure of your company can add to its stature and reputation. A Public Limited Company exudes an aura in the business world that any other type of company simply cannot, and this can have an impact on how the public perceives the company. This perception of being more established, larger, or more powerful can influence how customers, suppliers, and workers behave.
Since the sale of shares is open to the general public, and the company is listed on a publicly accessible platform like the stock exchange platform, people are highly likely to know about it. The media and financial experts are more likely to notice it. This essentially leads to free advertising or promotion of the company and more people to be aware of the business and its products / services. More sales may result from increased brand recognition.