Because that's how all of the original investors cash out. They originally purchased shares in the company to invest in it. The original investment went to the

Because that's how all of the original investors cash out. They originally purchased shares in the company to invest in it. The original investment went to the company itself. For argument sake, let's say they purchased those shares originally for $5 each. Now that the company is public, they can sell those shares on the open market for $45 each. The IPO is a combination of the company selling more shares to shore up its cash on hand, and for original investors to be able to sell their shares at a profit.