by Michael Corcoran September 23, 2021
An IPO (initial public offering) advisor is a firm hired to help a company navigate the process of listing on a public exchange for the first time. The advisor is usually an investment banking firm that has specialized knowledge of the company and the sector in which it operates.
Key Takeaways
- An IPO (initial public offering) advisor is a firm hired to help a company navigate the process of listing on a public exchange for the first time.
- The advisor is usually an investment banking firm that has specialized knowledge of the company and the sector in which it operates.
- An initial public offering (IPO) is a process of offering shares of a private corporation to the public in a new stock issuance; typically, a company will wait until it has achieved a certain stage of growth before advertising its intention to go public.
Understanding an IPO Advisor
Private companies wishing to go public and trade on a stock market exchange such as the New York Stock Exchange (NYSE) or NASDAQ undergo a process called an Initial Public Offering (IPO). An IPO is a process of offering shares of a private corporation to the public in a new stock issuance. Typically, a company will wait until it has achieved a certain stage of growth before advertising its intention to go public; this stage of growth usually occurs when a company has reached a private valuation of approximately $1 billion, also known as unicorn status.
Offering shares to the public allows a company to raise capital from public investors, monetize the investments of company founders or private equity investors, and enable easy trading of existing holdings or future capital raising by becoming publicly traded. Through this process, colloquially known as going public, a privately held company is transformed into a public company.
Source: https://www.investopedia.com/terms/i/ipo-advisor.asp