Book building is widely considered the most efficient way to price securities

Many investment bankers work on IPOs

When a company undertakes an IPO, investment banks often buy many of the organization’s shares directly from the company, in order to sell the shares on the stock market. The bank stands to profit after marking up the shares.

Companies pay multiple fees as part of the IPO process

When a company decides to approach IPO, it typically hires investment bankers—who earn about 7% of the IPO’s gross proceeds—to help set the organization’s target valuation range and schedule an IPO date. But that isn't the only fee associated with the IPO process.

It's difficult for individual investors to purchase IPO shares

Although the process of going public means the general public can invest in a company, the initial investment period is different. Before individual investors get in on the action, investment bankers sell the shares to larger financial institutions who can afford the asking price and risk associated with an IPO.

Ride along on one coffee company's journey through the stock market to better understand how a company goes from private to public.

An initial public offering is how a private company becomes public.

Initial public offering (IPO) is the term for when a company goes public

When a company completes its IPO, it's no longer a privately owned organization. Anyone can invest in the company by buying its shares on the stock market—opening up ownership of the business to the general public.

An S-1 reveals financial and other details to the public, often for the first time, when filing for an IPO

To file for an IPO, a company must file a registration form called an S-1 or prospectus with the US Securities and Exchange Commission. S-1s detail a company's current business model, competitive landscape, and other financial information.

Companies go public via an initial public offering (IPO) to raise large amounts of capital, helping them expand, invest in new ventures, hire more staff, or pay off debts.

Learn how to read a prospectus, the juicy document that any company must file with the SEC before going public

A prospectus typically contains information about the company's operations, including details about its management team and their compensation, financial statements, how it intends to use any capital raised by the IPO, and more. While these documents can be dense and lengthy, experts say that some of the most important sections of a prospectus for investors to look at include the risk factors section and the use of proceeds section.

Investment bankers are architects of the largest financial transactions in the world

Working up to 120 hours a week, investment bankers help major corporations navigate IPOs, mergers, and more. Despite long hours and a high-pressure environment, investment banking remains a critical industry that shapes the global financial landscape.

It’s an investment banker’s job to raise money for the bank’s clients

Investment bankers do this in a multitude of ways, such as selling securities, or acquiring other companies.

Read about the day Palantir went public in 2020

After more than 15 years in business, Palantir held its initial public offering (IPO) via a direct listing—meaning the company didn't rely on underwriters to assess the initial trading price or stock value. Palantir's stock ended the day trading 31% higher than the reference price.

Smaller companies’ IPO information can be hard to track down

This calendar keeps you updated on the current IPO dates and pricing from different companies. You can search for upcoming and future IPO dates and see which companies withdrew from the IPO process.

Google had a quirky, auction-based IPO.

In its sixth year, Google's shareholders reached a size where regulators would require the company to publicly report its financials. This prompted the company to go public through an unconventional style: the Dutch auction. The company auctioned its shares starting from a high price and dropping to a lower level.

US IPO issuance—the total dollar amount of new stock sold to the public via IPOs—hit a record high in 2026.

The cryptocurrency equivalent of going public

An initial coin offering (ICO) is cryptocurrency's version of an initial public offering (IPO). Similar to the way a company offers shares on the stock market for the first time, ICOs occur when a cryptocurrency company seeks to raise funding for a new coin, app, or service. If you're entering the field, get the details on how it all works.

A direct listing is when a company goes public, listing shares on a stock exchange

A direct listing is when a company goes public, listing its shares on a stock exchange, rather than issuing new shares or raising capital. That means investment banks—traditionally serving as intermediaries—could lose out on some of the profits from these deals as more companies like Spotify opt for direct listings.

Some companies like to make their IPO day antics unique.

An article details some of the wildest bell-ringing day stunts in recent history, from Clifford the Big Red Dog ringing the opening bell to one company's employees roasting marshmallows in a campfire on Wall Street as it went public.

Investors trading their municipal bonds can't use the same method to purchase them

Instead, they’ll have to go through the secondary market, which has its own set of rules and steps to follow. An illustrated, explanatory video can help you learn how to sell your municipal bonds for the best market value.

Going public has pros and cons for a company.

An organization transfers ownership over to new shareholders—who could be anyone—following its IPO date. However, going public expands a company's ability to increase funding and grow its business. This guide dives into the advantages and disadvantages of going public, and what those pros and cons can mean for investors.

The prices on prediction markets reflect how the collective forecasts future outcomes.

'Payment in kind' is a compensation method that uses alternatives to cash

Companies can make payments using goods, services, or additional securities instead of cash, helping companies preserve their cash flow. Public BDCs receive roughly 8% of their investment income via PIK.

Stock buybacks are when a company purchases some of its own shares of stock

This reduces the number of shares on the market and, therefore, makes the remaining shares more valuable. Buybacks have received a lot of criticism in recent years for many reasons, such as how they could artificially inflate share prices.

Startups fundraise in 'rounds' as they prove out their business and scale

When startups take on outside funding, those investments are divided into different "rounds." These rounds are catered to different stages in a startup's life cycle—a startup often needs different types of investors and amounts of funding at different stages of the business. For instance, a pre-seed investment round can include investments ranging from about $25K to $500K, whereas a Series D investment can be hundreds of millions of dollars.

Robinhood's mission of democratizing finance included its IPO

In 2021, investing app Robinhood went public—and decided to go about its IPO process differently. Unlike other companies, it opened up its IPO for the general public to purchase right away. A podcast episode explains what made Robinhood's IPO so unique prior to its launch date.

Retail investors are individuals who trade stock for themselves

Institutional investors, on the other hand, are investing for someone else. There are big differences between the two, one being that institutional investors can be granted certain special treatment (like being able to purchase IPOs right away).

Companies sometimes issue corporate bonds to raise capital

These bonds offer investors regular interest payments in addition to the return of the principal amount at maturity. They allow companies to raise capital without losing ownership.

Private companies are often harder to value than public companies

That's partly because there isn't readily available stock information, and financial accounting is kept behind closed doors. Typically, determining the value of a private company involves, among other things, closely comparing the private company with its competitors.

Millions of Americans will be invested in SpaceX because of the fast-tracked process to list SpaceX on the Nasdaq 100, and, subsequently, the index funds that track it.

There are three main ways to start investing in the bond market

Invest in the boind market through a brokerage, mutual fund or ETF, or the US government. Each has different steps and terms to follow, from starting rates to opening specific accounts. Some bonds are relatively easy to purchase, but the process differs depending on the type of bond you want.

The bond market is where bonds and other debt securities are traded

Bonds are fixed-income investments allowing individuals to lend a specific amount of money to a large entity, like a government or corporation, for a set amount of time in return for interest paid out over the life of the loan. The bond market is widely considered a key economic barometer.

Special-purpose acquisition companies let companies skirt the IPO process

A video explains how private companies have taken advantage of this loophole, why investing in these companies isn’t always a good idea, and how blank-check companies (as they’re commonly called) work.

See how SpaceX compares to history's other largest IPOs.

Entry-level investment bankers boast $200K paychecks, but it's not all base salary.

Retail investors are average joes, while institutional investors often move billions of dollars a day

Retail investors often trade 100 shares at a time, while institutional investors trade 10,000 or more. The biggest difference is that, unlike retail investors, institutional investors are professionals who are trading someone else’s money.

Seed funding is often the first round of capital that a startup raises

Early-stage startups often try to secure seed funding from investors in order to take their idea from concept to reality.

The 'big bang' of the dot-com era: Netscape's stock price doubled on the day of its initial public offering

The company behind the browser that revolutionized search went public on August 9, 1995. Just before the IPO, the company increased its initial opening price from $14 to $28. On the day the company went public, shares traded as high as $71 before closing at $58.25. The company's market capitalization exceeded $2B. The eye-popping IPO is largely considered the beginning of the dot-com bubble.

Some experts and investors think short selling—a strategy in which investors bet that a stock will drop in value—helps keep the market healthy.

Value investing is the strategy of buying assets you believe are worth more than their current price

Famed investor Warren Buffett is known for building his empire with this strategy, which he learned from his mentor Benjamin Graham.

IPOs that failed

Plenty of private companies fail once they try to go public. Failing can mean shares sell for less than their initial asking price on its IPO date, or it can look like a company pulling out of the IPO process at the last minute. Some companies with failed IPOs include Pets.com, Etsy, and Robinhood. Learn more about these companies and others here.

Private equity firms often use leveraged buyouts to acquire new companies

In a leveraged buyout or "LBO," private equity funds finance acquisitions with debt secured by the target company's assets and cash flows. The PE firm aims to improve operations and leverage the company's profile to pay down debt, thereby increasing equity value.

Shorting is a high-risk and expensive investment strategy that hedge funds specialize in

Most investors buy stocks with the expectation that those stocks will be worth more tomorrow than they are today. Short selling, known as “shorting,” a stock is the opposite: The investor is betting the stock will drop in value.

SPACs, explained

Special purpose acquisition companies make it easy for mature unicorns (companies valued at over $1B) to receive growth capital by going public. This process effectively skips the work of a traditional initial public offering, and its time-intensive investor negotiations. Typically, a well-known investor with expertise in a certain industry sponsors a SPAC with the intent to acquire a startup. Learn how it works and the risks involved here.

Companies often use different share classes, like Class A or Class B, to structure ownership

Share classes refer to specific types of company stock that are distinguished by the rights they grant, such as voting power and dividend access.

Watch how the S&P 500 is actually calculated

After accounting for each company's float-adjusted market capitalization (a metric that combines the price of a company's stock, the total number of shares, and the stock's float, which means how many shares are actually available), the S&P 500 formula uses a divisor to create the index number. However, what the divisor is and what it represents are secrets.

Startup founders’ equity becomes diluted as they bring in more investors

When an angel investor funds a company in exchange for equity, startups issue new shares to them, rather than giving them existing shares, and boost the company’s valuation.

What do investment bankers actually do?

Investment bankers organize large financial transactions at a high level. But what does that look like day to day? A video breaks down the specifics about the transactions and deals investment bankers work on, and which members of an investment banking team have eyes on each project.

Airbnb’s S-1 in 2020 revealed how it weathered the pandemic and its financials

An S-1 or prospectus is a registration form filed with the US Securities and Exchange Commission when a company wants to go public. They can be pretty juicy documents, as S-1s can reveal previously private details about companies to the public, often for the first time.

Insider trading is the practice of trading a company's securities based on material, nonpublic information.

SpaceX's S-1 or 'prospectus' revealed many previously unknown details about the company

Those revelations include the company's unprofitability despite doing $18.7B in revenue in 2025, exactly how many voting shares Elon Musk will have in the company (roughly 85%), and more.