The purpose of selling stock to the general public is for the firm to raise money. A company agrres to sell a percentage of the company to the general public for a defined amount of money.
What happens in the market place with the buying and selling of the stock does not effect the company, it gains nothing nor does it loose anything
It won't. If the shares were owned by an existing FB shareholder then there's no new money for FB. You are sending money to an existing holder. If FB issued new shares then it would add money to the business. This isn't going to happen since FB is flush with money and has billions of shares owned by venture capitalists and early employees that will be fed onto the market as people cash out.
The benefit of this IPO was to make the shares of the existing FB employees and FB private shareholders easier to value and to sell.
It raises a company capital when investors purchase their stock.
That $100 you invested is now $100 cash the business has to work with.
hi, i would like to know that how does a public company benefit after there IPO has been in public, say that FB is now in public and traded in Nasdaq, now my question is that say i go and buy 100 shares of FB from a stock broker or a discount brokerage, how will FB benefit from me buying there 100 shares.
