IPO is the very primary sale of stock issued by a company to the public. Previous to an IPO the company is measured private, with a relatively little number of shareholders made up mainly of untimely investors like founders, their families and professional investors like venture capitalists. The public, on the other hand, consists of each one else any personality or institutional investor who wasn’t worried in the premature days of the company and who is concerned in buying shares of the company. Until a company’s stock is accessible for sale to the public, the public is not capable to invest in it. You can potentially approach the owners of a confidential company about investing, but they're not forced to sell you anything.
If you are a shareholder of a private company, it is very complex to sell your shares, and even more complex to charge your shares. A public company trades on a stock market, with prepared buyers and sellers and identified price and operation data. The stock market is therefore definite to as the minor market, since investors are buying and selling stock from other public investors and not from the company it.
An IPO, to repeat, is when the company sells stock to the public. If a firm can encourage people to buy stock in the company, it can host a lot of money. The IPO is seen as an exit approach for the company founders and untimely investors to income from their early risk-taking in a new venture. Therefore, in an IPO many of the shares sold to the public were before owned by those founders and investors.
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