Definition

The first time a private company offers its shares to the public to raise capital and expand its business.

What to consider

  • Know your own comfort level with market ups and downs.
  • Match your investments to your risk tolerance.
  • Keep an emergency fund to cushion any potential losses.

Real world scenarios

  • When his startup decided to go public, Daniel’s company held an initial public offering (IPO) that allowed early investors to cash in on their equity.

Related terms

Investments & Retirement