This liquidity can elevate the value of the corporation. The stock's liquidity is contingent on a variety of factors including, registration rights, lock-up restrictions and holding periods. A public company has greater opportunity to sell shares of stock to investors. Ownership of stock in a public company may help the company's principles to eliminate personal guarantees. Liquidity can also provide an investor or company owner an exit strategy, portfolio diversity, and flexibility of asset allocation.
Many companies use stock and stock option plans to attract and retain talented employees.
It is increasingly common to recruit and compensate executives with a combination of salary and stock. Stock in a public company can be issued as a performance based reward or incentive. This reward could be deemed desirable if the stock has a public market. Stock can be instrumental in attracting and keeping key personnel. Also, certain tax advantages are a consideration when issuing stock to an employee.