Cryptocurrency Q&A
Who gets money from an IPO?
Who gets money from an IPO?
CryptoLegend
Sun Sep 29 2024
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5 answers
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Could you please explain in simple terms who actually receives the funds generated from an Initial Public Offering, or IPO? I understand that it's a process where a private company goes public by selling shares to the public, but I'm curious about the specific entities that benefit financially from this transaction. Is it the company itself, the shareholders who sell their shares, or both? And how does the distribution of these funds work in practice?
5 answers
EthereumEmpire
Mon Sep 30 2024
Filing an S-1 with the Securities and Exchange Commission (SEC) is a crucial step for companies seeking to raise funds through an initial public offering (IPO). This document outlines the company's financial condition, business operations, and the intended use of the proceeds.
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Silvia
Mon Sep 30 2024
Other professionals, such as accountants and lawyers, also contribute to the IPO process. Accountants review the company's financial statements and ensure that they comply with regulatory requirements. Lawyers, on the other hand, advise the company on legal matters and draft the necessary documentation.
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KimonoGlory
Mon Sep 30 2024
The S-1 filing serves as a disclosure to potential investors, enabling them to make informed decisions about whether to invest in the company. It also outlines the risks associated with the investment and the company's competitive landscape.
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Tommaso
Mon Sep 30 2024
While companies retain the majority of the proceeds from an IPO, a portion of the funds are allocated to those who facilitate the process. Investment banks, accountants, lawyers, and other professionals play a critical role in ensuring the success of an IPO.
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ShintoMystery
Mon Sep 30 2024
Investment banks, for instance, assist companies in determining the appropriate valuation, marketing the offering to potential investors, and managing the distribution of shares. They also underwrite the offering, which involves purchasing shares from the company and reselling them to the public.
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