Three ideas: why to list on PLUS not AIM

The PLUS market is increasingly replacing AIM as the preferred destination for small, fast-growth companies looking to raise equity finance, gain an independent valuation and enhance their profile. Here's why:

It's cheaper

The admission process for PLUS averages between £100,000 and £150,000 so offers considerable savings on an AIM listing, which rarely costs under £500,000 and can easily mount to £1m. Ongoing advisor, regulation costs and fees are also substantially lower.

There's less regulation

PLUS positions itself as the market for small companies that is light on regulation and comparatively low-cost - so, as you'd expect, its listing process is far less onerous than an AIM IPO. You don't have to raise funds immediately, either: you can join PLUS simply to raise profile or to get an independent value for your company. This only requires an admission announcement and limited application documentation filed by a PLUS corporate advisor.

Even if you are looking to raise funds you won't need to file a full prospectus or admission document (required on AIM and where the time and costs build up) if you're offering a private placement to fewer than 100 people.

You'll be a big fish in a small pond

Five years ago, AIM's main sales pitch was that it cost less than a main LSE listing and was the alternative market where small companies would get more profile. Now AIM's a pretty damn pond packed itself, PLUS is where small companies stand a better chance of making a splash.

Compared to AIM's 1,500-plus companies, just 201 companies are currently quoted on PLUS. Those raising cash typically close between £1-2m and on average have a market cap of £20m.

Okay, so PLUS doesn't have the liquidity or profile of AIM but since becoming a 'Recognised Investment Exchange' in 2007, its stock has reason considerably with investors.

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