Direct public offerings have the major advantage that the company can sell its stocks directly to investors, hence, the costs with intermediates, which are specific to IPO, being cut. If the company chooses to use the direct public offering tool, then it is absolved from reporting and registration requests of SEC.
Other major advantage of direct public offerings is that there is no short-term results required by the investors.
The results of direct public offerings can be considered advantages for small companies that do not afford the costs correlated with the initial public offerings (IPO). But, there exists some disadvantages too, since there is no market price and the stock is sold with a lower price than the price that could be demanded through IPO. There exists also the disadvantage of limitation of the amount raised by the company within 1 year.
One typical direct public offering is small corporate offering registration that is available to small businesses, it limits the amount raised by the company to 1 million per year and it does not impose limitation to the number of investors.