What is an Initial Public Offering - IPO?

An initial public offering is when a private company or corporation raises investment capital by offering its stock to the public for the first time. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

| Term of the Day Initial Public Offering - IPO The process of offering shares in a private corporation to the public for the first time is called an initial public offering (IPO). Growing companies that need capital will frequently use IPOs to raise money, while more established firms may use an IPO to allow the owners to exit some or all their ownership by selling shares to the public. In an initial public offering, the issuer, or company raising capital, brings in underwriting firms or investment banks to help determine the best type of security to issue, offering price, amount of shares and time frame for the market offering. Read More » Related to "Initial Public Offering - IPO" How an IPO is Valued The initial valuation of an IPO can determine the success or failure of a specific stock – but how is that price determined? Read More » Private Equity vs. Public Equity: What's the Difference? Both public equity and private equity have advantages and disadvantages for companies and investors. Read More » Why Public Companies Go Private Many reasons exist for a public company to go private. Privatization can give management more time to make money for investors, but at what cost? Read More » Related Definitions Dutch Auction A Dutch auction is a public offering auction structure in which the price of the offering is set after taking in all bids to determine the highest price at which the total offering can be sold. Read More » Public Offering A public offering is an organization's sale of equity shares or other financial instruments to the public in order to raise funds for business expansion. Read More » Private Company A private company is a company held under private ownership with shares that are not traded publicly on exchanges. Read More » Underwriting Underwriting is the acceptance of risk by a financial institution or individual., more specifically financing or guaranteeing. Read More » CONNECT WITH INVESTOPEDIA Email sent to: mondemand.forex@blogger.com To update your newsletter preferences or unsubscribe, click here. 114 West 41st St, floor 8 New York NY 10036 © 2019, Investopedia, LLC, All Rights Reserved | Privacy Policy