If a company decides to issue
stock
in a regulated capital market, it must go through a lengthy process before the shares can be sold to the general public. That’s true whether it’s the company’s
initial public offering
(IPO), or if the company is already a public company and has decided to make a
secondary offering
of shares.
Considering the consequences
Issuing stock is a means to raise capital, but it can also dramatically change the nature of the company. A well-publicized or successful IPO affects the company’s national reputation, and selling ownership shares means the company must answer to new bosses, in a sense, allowing shareholders a voice in the way a company is run, and in some cases opening the company to the possibility that the founders may be replaced as company executives.
But for many companies, the benefits of the added capital are well worth the potential downside, which is why thousands of companies are
listed
on the stock market.
Professor Samuel L. Hayes,
Harvard Business
School
Professor 
