[couradical]

There's no requirement to go "public" in the sense of listing on an exchange, and available for public purchase. What changes at that point is SEC regulatory compliance kicks in: earnings/revenue go public, SEC compliance paperwork has to be filed just like a public corp. That's really why people try to stay under that number - you have all the drawbacks of being public, except a floated share price, and it would effective crush any IPO pop that they would expect to get, as financials would be totally available, so offer price would have to reflect the company's financials.

[lmm]

Isn't an IPO pop bad for the company? It indicates that they priced too low, no?

[dsl]

The underwriter of an IPO goes around and sells your stock to their largest clients in advance (which is where the company gets its payout). They sell your stock at say 10% less than what they think it will settle at. All the pre-IPO buyers cash out within the first few hours of trading. Without a big enough "pop" your stock is considered to have been a bad investment by the underwriters and the pre-IPO buyers because they didn't see 10%+ one day returns.

IPOs are layers upon layers of scams and shady dealings.

[couradical]

I think it's a fine line- I'm not in finance, but from what I understand you want some incentive to purchase a new issue as you have a set target of shares you're trying to move. I think that doubling in price is a bad thing, but I don't think movement of a few dollars per share is necessarily a bad thing.

[ilyanep]

A small pop could indicate that the private-ness (and thus illiquidity) of the shares were priced in before.

[cma]

IPO filings include financials...