I think you understand IPOs correctly, but you missed the bit where this isn't an IPO. This is the bit where some firms say "hey, at some point in the future y

I think you understand IPOs correctly, but you missed the bit where this isn't an IPO. This is the bit where some firms say "hey, at some point in the future you should totally sell yourself through us, we think you're very likely totally probably worth a zillion dollars". And then at some point in the future Uber will actually do an IPO with one of these banks, and the underwriters will price the stock at whatever level they're confident they can clear the shares, and it will be a lot less than $120 billion, and Uber will say "what happened, you said you thought we were worth a zillion dollars!", and the banks will cough and shuffle their feet, and tell some white lies, and blame the economic cycles and sunspots and the lack of vision of the institutional investors who bought the bulk of the shares. But the reality is, nobody thinks Uber is worth $120B, and nobody (least of all Uber) should take the headline as suggesting that someone does. The $120B number is meaningless, it's just flattery to try and convince Uber to go with them for the IPO, where actual numbers will have to be pulled out of a hat.