Ever read the news and wondered what this term “IPO’ meant? Well this will explain it to you in simple words. https://medium.com/@Curious-cat/analysis-of-tech-ipos-in-india-9198dcb83440

1. What exactly
is an IPO?

2. If you have been listening to recent finance or economics
new you must have heard this term being used quite often.
So today’s let’s see what exactly is an IPO?

3. >>IPO stands for Initial Public Offering, it is the process by
which a company can go public by offering it‘s shares for sales to
the general public to purchase .
>> After this the company is listed on the stock exchange.
>>Originally only the founders and initial investors own the
company. After IPO a company will have possibly hundreds
of thousands shareholders.

4. >>Going public can be risky. The company is now
accountable to a huge number of shareholders.
>>It now has to have periodic audits and scrutiny from
shareholders can also lead to shareholder lawsuits.
>>This process is a long expensive and exhaustive process
taking months. The firm will need to hire lawyers,
consultants, accountants and investment bankers

5. With all these possible problems why would a
company want to for an IPO?
>>Well IPO helps firms acquire a huge amount of capital.
>>This will help them expand, improve and have enough
resources to hire a good workforce and senior
management.
>>IPOs also are a means for the initial investors or founders
to have an exit by selling their shares.

6. >>Thus IPO has its pros and cons and a firm must properly
analyse the market and whether this risk would be worth it.
>>It is not necessary to go public to be successful, Sweden
furniture giant IKEA is a private company.

7. I hope this was helpful, if you’d like to read more
about IPOs do read my blog post, the link is in my bio