Step 1. Hire Underwriters → Traditionally, the IPO process is initiated by a private company hiring several investment banks—often referred to as “underwriters”—to advise on the transaction and ensure the maximum amount of capital is raised, with the minimal amount of issues encountered (e.g. conflicts with regulatory requirements). Step 2.
What is an initial public offering (IPO)?
The term initial public offering (IPO) has been a buzzword on Wall Street and among investors for decades. The Dutch are credited with conducting the first modern IPO by offering shares of the Dutch East India Company to the general public.
What are initial public offerings & how do they work?
Initial public offerings can be used to raise new equity capital for companies, to monetize the investments of private shareholders such as company founders or private equity investors, and to enable easy trading of existing holdings or future capital raising by becoming publicly traded.
