Yesterday a person asked me to create an ICO to raise money for his business. I first explain him to create an ICO it's a long process and taking about 6-8 months to prepare all the paperwork and a lot of marketing work besides the computer programmation. The pending question was what is the better way to raise money IPO or ICO ?

Background

To answer this question we have to understand the two systems.
IPO - Initial Public Offering refers to the public sale of the shares of a company with an objective to expand and develop their business.
ICO - Initial Coin offering, a crowdfunding way to raise money to develop an idea/project selling utility tokens instead of shares.

Differences

I created an acronym to remember the differences - "DURAT"

Duration

Due to all the regulatory process, the IPO can take up to 4-6 months.
The ICO crowdsale length can be dependent on reaching the maximum hard cap, or a fixed sale duration, which usually lasts a month. EOS is an atypical example. Normally there is an IPO lockup duration meaning, insiders who are holding a company's stock, before it goes public, are unable from selling the stock for a period usually lasting 90 to 180 days after the company goes public.

Utility

Stocks represents an ownership stake in the future earnings of the company. Stocks can be divided into different classes. The utility of holding a stock is the entitlement of the shareholders in receiving dividends and having a vote in the shareholders meeting bringing about a loss of control of the company. However, ICO tokens don't grant any ownership over the project nor the company. They allow you to use a service and store a value.

Regulatory Omission

To be registered as an IPO a company has to fill a prospectus. A prospectus represents a legal declaration of the company intends to issues shares to the public and need to meet certain standards of transparency some of them are the requirement to disclose financial and business information. In order to raise funds with an ICO, you only have to present a whitepaper. There is no standard whitepaper and this is not mandatory, on the white paper you can enclose information about your projects. The Stock trading platforms have various standards called ISDA
That is why there is a lot of scams, since the crypto area still developing there is a lack of regulations preventing and protecting investors. That is why the SEC is so interested to get into this market.

Access to Offerings

Shares are allocated only to institutional investors such as investment banks and only a small portion is allocated for individuals. To participate to an ICO is much simpler you only have to buy some Bitcoins or Ethers and send them to a wallet. It seems the power is coming back to individuals, market and exchange are becoming broader as they were hundreds years ago.

Track Record

Some requirements to receive the legal authorization to share shares is to show a minimum earnings threshold and a good track record and all of that being verified by accounting firms. For ICO it is much easier , you only have to present your whitepaper, if you already have a POC (Proof of concept) it will help you to get more investors.

I don't know which process is the best, both have to improve, happy trading.

P.S- The liquidity is much faster when you have an ICO due to the lack of regulations.