Initial Public Offering

Definition

• The process by where a privately held corporation becomes a publicly traded corporation by giving the general public the option to buy stock for the first time. An initial public offering (IPO) is often used to raise expansion capital, but an IPO can also be used to increase exposure in the corporation, attract or retain better management and employees, facilitate acquisitions or to enable cheaper access to capital. Also known as a "public offering."

Synonyms
public offering

Acronyms
IPO

Related Terms and Acronyms

• Angel Investors — Definition,
  • Private individuals with capital to invest in business enterprises.
• Common Stock (CS) — Acronym,
  • A security that allocates partial ownership in a corporation, but at a lower standing than preferred stocks.
• Equity — Definition,
  • Ownership in an asset.
  • The value of a property minus outstanding mortgage debt and other liens.
• Incorporated Business — Definition,
  • A company that exists as a corporation.
• Preferred Stock — Definition,
  • A type of security that signifies part ownership in a corporation and is given preferential treatment over common stocks.
• Private Equity — Definition,
  • Equity not traded on a stock exchange.
• Privately Held Company — Definition,
  • A company that is not listed on a stock exchange.
• Publicly Traded Company — Definition,
  • A company that is sold on a stock exchange.
• Security — Definition,
  • Property designated as collateral.
  • A document stating ownership of a stock or bond.
  • A tradable financial implement that represents ownership, the rights to ownership or debt.
• Seed Funding — Definition,
  • Money used to start a business.
• Startup Company — Definition,
  • A recently founded company that works on new products and services.
• Stock — Definition,
  • A share of the ownership of a company.
• Venture Capital (VC) — Acronym,
  • Financial capital given to startup companies.