What is an IPO in business?

Initial public offering

An IPO is the initial point that a private company offers shares to the public in a new stock issuance. It is a common term you will hear or see in business in person, on TV, and online that represents a company's transition from private to public.

IPO is a momentous occasion for the company founders, private investors, and the public on the primary stock market. It allows the company to raise a lot of funds as the public on the market buys into the company. It can also be a point that the founders and early investors "cash out" if they want to exit from their investment.

Most IPOs occur when a company's valuation reaches $1 billion (USD). They can then choose to go forward with an IPO, but they must go through several arduous processes, including hiring investment banks to verify the potential of the company, set share prices, and choose the IPO date. The company must also meet requirements enforced by the Securities and Exchange Commission (SEC).


I was so glad I bought the stock right at the IPO since it's performed so well over the years
Yeah, that worked really well for you
Tweet about Amazon's IPO in 1997
Tweet about Amazon's IPO in 1997

Related Slang


Updated May 22, 2023

IPO definition by Slang.net

This page explains what the acronym "IPO" means. The definition, example, and related terms listed above have been written and compiled by the Slang.net team.

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