• IPO stands for Initial Public Offering. It is called when a company sells stock to the public for the first time. 

  • Stock is sold in the primary market at an offering price determined by the IPO team. Following The financing, the shares are traded in the secondary market air "aftermarket". 

  • Selling Stock in primary market is assisted with investment bankers or underwriters that help promote the potential offering. 



The steps to get IPO:
  1. Company filled the registration with the Securities and Exchange Commission 
  2. For majority of firms going public, they need additional capital 
  3. Meeting for the IPO process to registers with SEC, which usually takes 6-8 weeks 
  4. After complete the registration, the company has to wait until the National Association of Securities Dealers has done for review the document for any missions or problems
  5. The lead underwriter must then assemble a syndicate of other investment banks that will help sell the deal. Syndicates usually include investment banks that have complementary client bases, such as those based in certain regions of the country 
  6. The next step is the road show. It takes a week or two, with the company management meeting with prospective investors to present their business plan 
  7. After the road show ends, the company management meets with their investment bank to choose the final offering price and size 
  8. Investment firms have 2 sets of clients: The company going public to raise money as much as possible and the investors buying the shares
  9. If the IPO is weak, the shares or their price may be cut from expected ranges. IF the IPO is strong, it can also be raised from initial expectations 
  10. The offering price has been agreed on, and at least 2 days after investors receive the final prospectus, an IPO is declared effective. 
  11. THE TRADING NOW BEGIN!!