1 Once upon a time, when you bought broccoli you bought the whole vegetable, stems and crowns. Then it became customary for grocery store produce departments to separate the crowns from the stems and to sell the crowns at a premium. 2  Iâm not a fan of this practice, because I like both parts of the broccoli plant.
A company's first issue of common stock to the public is called an Initial Public Offering. Afterwards, a corporation may issue new equity at any time in order to finance its growth. When new common shares are offered to existing shareholders first, this is called a rights offering.
An initial public offering (IPO) is the process by which a private company becomes publicly traded on a stock exchange. Once a company is public, it is owned by the shareholders who purchase the company's stock when it is put on the market. For many investors, the only real exposure they have to the IPO process occurs a few weeks prior to the IPO, when media sources inform the public.