What is the difference between an IPO and a secondary offering?

An initial public offering (IPO) and a secondary offering are two ways for companies to raise money by selling shares of stock. An IPO is the first time a company offers shares of its stock for sale to the public. It’s the first time the company becomes a publicly traded company. A company can use the money raised from an IPO to grow the business, pay off debt, or for other corporate activities. A secondary offering occurs when a company that has already conducted an IPO sells additional shares of its stock to the public. The purpose of a secondary offering is usually to raise more money for the company, or enable current investors to cash out some or all of their holdings. Secondary offerings are also often used to raise money to pay dividends, buy back stock, or reinvest in the company. In summary, an IPO is the first sale of a company’s stock to the public. A secondary offering is when a company already on the stock market offers additional shares of its stock to the public, usually to raise more money or allow current investors to cash out.

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What is the difference between an IPO and a secondary offering?

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