Initial Public Offering

July 31, 2014  |     |     |   0 Comment

An Initial Public Offering (IPO) involves the selling of shares of a company to the general public for the very first time. It is often referred to as “going public.”

Businesses go public to raise capital and grow and also to provide financial liquidity to shareholders. The company then becomes a publicly-traded entity and must report its operational and financial performance to investors regularly.

One of the main benefits of an IPO is a private company with illiquid shares becomes a publicly-traded company with liquid shares. As such, after the IPO, its shares are traded freely in the market. Early investors can sell their shares to the public in an open market.

Author: 

Kris Tabetando provides mergers & acquisitions (M&A) advisory and brokerage services to Internet companies. He also partners with investors to acquire & manage Internet businesses.

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