What is an IPO | by Wall Street Survivor
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What is an IPO | by Wall Street Survivor


what is an IPO presented by Wall Street survivor calm an initial public offering or IPO is the very first time a private company issues stock to the public a company can decide to issue stock for a number of reasons including to raise money for growth or to allow employees owners and early investors to liquidate some of their shares and make money to explain how an IPO works let’s look at Dave Dave owns a chain of very successful food trucks in Chicago but Dave sees a bigger future for his business and wants to expand his operation to other cities to do so he decides to issue shares to the public to raise the necessary cash he needs to build more trucks inventory marketing and staff Dave can’t just issue stock himself to the public he needs to use an investment bank if the IPO is big enough a company can use multiple investment banks but since Dave’s offering is small he uses one JP Stanley based on the value of Dave’s company Dave and JP Stanley determined the IPO price the amount of shares they will use and the percentage of ownership of Dave’s food trucks they will give up JP Stanley values Dave’s food trucks at 100 million dollars and Dave decides to sell 10% of his company ten percent of 100 million means Dave will be raising ten million dollars the investment bank decides they will be issuing 1 million in shares to the public at $10 apiece the investment bank then lists the shares on a stock exchange for the public to buy investors can now buy shares of Dave’s food truck in the late 1990s IPOs really took off as technology startups were issuing stock and raising a ton of money extremely quickly this led to the internet bubble and subsequent collapse you can buy publicly traded companies for free on Wall Street survivor calm

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20 thoughts on “What is an IPO | by Wall Street Survivor

  1. hey plz do this kinda video on OCT(over the counter)….ur videos are really great and easy to understand ,🙄😏

  2. Very informative, I like it that you show the actual price and not the opening price
    In the video below you can also see some examples to successful IPOs vs Losing one:

    https://www.youtube.com/watch?v=OgaEWj1FK1A&t=37s

  3. Yeah I don't trust banks outside of savings and checking and cds I'll dabble in stocks but wont in bonds

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