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What is an IPO?
Quick answer
An IPO (Initial Public Offering) is when a private company sells shares to the public for the first time, becoming a publicly traded company. It raises money for the business and lets everyday investors buy a stake. IPO stands for Initial Public Offering.
Key things to understand
- IPO stands for Initial Public Offering.
- A private company sells shares to the public for the first time.
- It raises capital and lets the public invest.
- After it, the company's stock trades on an exchange.
People also ask
What is an IPO?
When a private company first sells its shares to the public and becomes publicly traded.
Why do companies go public?
To raise large amounts of money, let early investors cash out, and gain public profile.
Is investing in IPOs risky?
It can be — new public companies are often volatile, and early hype doesn't guarantee long-term success.
Part of the guide: Money Basics: Save, Borrow & Invest →