An unlisted company can sell to an unlimited number of shareholders, but because the company is small, it is not listed on the official stock exchange.
An unlisted company is the combination of a small business and a publicly traded company that can sell stock to raise money for businesses. Unlike a proprietary company, an unlisted company can sell to an unlimited number of shareholders, but since the company is small, it is not listed on the official stock market. When an investor buys shares, he can sell them back to the company at a later date or he can sell them to someone else because there is no official market for those shares. Investors can’t check the stock market to quickly identify whether the stock’s value is going up or down, so an unlisted company has strict rules for reporting profit or loss to investors.
Public companies are those that go public and sell shares to raise money for projects and companies while helping investors make a profit on their investments. A publicly traded company follows this same model, but is not publicly traded. They are public, in the sense that the public can buy shares of the company. Unlisted quality is what most distinguishes this business.
The reason an unlisted company goes unlisted is not so much because of the laws, but because of size. Unlisted companies are often too small to list on the stock market. Although they are small, they can sell shares to an unlimited number of shareholders, but some investors are wary of returns, so the number of shareholders per company is often small.
They are not publicly traded, so unlisted company models have a different relationship with investors than public companies. They generally do not advertise to investors, and in some regions, advertising to investors is illegal for this business model. In areas where this is legal, a promoter will often talk to investors and try to sell shares. These companies follow strict reporting guidelines, often having to report at the end of the fiscal year or quarter so investors know how the stock is doing.
When an investor wants to sell his shares, he can sell them to one of three entities. The two obvious options are to sell back to the developer or the company, just like in the stock market. The third entity is any person interested in buying the investor’s shares. This is unusual, but it is another option for investors.