An initial public offering (IPO) refers to the issuance of stock by a privately-held company to public investors for the first time, i.e. in the primary market. The company becomes, therefore, owned by the public (publicly held), ceases to exist as a private ownership, and its shares are listed on one or more of the major stock exchanges such as the New York Stock Exchange, the NASDAQ, the Tokyo Stock Exchange, etc. An exchange-listed company must comply with regulations issued by relevant authorities such as an exchange commission or central bank. For example, specific financial information about the company should be disclosed to investors such as financial statements, quarterly reports, reports on complying with requirements, etc.

Public offering of securities are typically undertaken by a group of investment banks through a process called underwriting. A lead investment bank sets up an underwriting syndicate of chosen investment banks to collectively share efforts and responsibility.

IPOs are usually conducted in two methods: firm commitment and best efforts.