3 ms·

I don't understand this logic. If it's a given that the price of a company goes up after the IPO, why would any company ever sell beforehand?

• erez 16y ago
  First, it's not a given. Second, selling the company puts money in the pockets of the shareholders, while going public means the company is getting the money. Going public, by definition, means revealing your data, your balances, budgets, revenues, it might not look as good as it is now, especially in a bubble-based market. It's (very) basically like the usual 'let's make a deal' bargain, you can either get 1000$ now, or gamble for the envelope that might have ten times that, but might also have much less.