[notyourday]

> So basically the IPO is a way to formalize the initial price of the stock. By bypassing that process, they will sell for whatever the market dictates for better or worse, is that correct?

No, IPO is the placement of the shares from whoever has them before the IPO position ( underwriter or the company itself ) to the accounts of those who want to have those shares the moment before the new issue is listed on an exchange.

Buying at the open is not buying at the IPO.

Company X selling shared to underwriters at $7/share is not an IPO.

Underwriter pricing shares that it bought from the company for $7/share at $11/share and delivering those shares to the Suzy Investor who wanted to buy that company before the shares open is the IPO.

Suzy Investor selling shares at $11.05 which is the national best bid the second after the stock opened to John Q. who did not get the shares from the underwriter is NOT the IPO.