Summary of In Defense of the IPO, and How to Improve It

Looking for the article?
We have the summary! Get the key insights in just 5 minutes.

In Defense of the IPO, and How to Improve It summary

Editorial Rating



  • Background
  • For Experts
  • Insider's Take


While the initial public offering is still the most favored vehicle by which new companies can tap the equity markets, entrepreneurs now have a range of options, including direct listings, special purpose acquisition companies and IPOs. Nonetheless, “going public” remains a complex process, and stakeholders need to thoroughly understand the mechanics behind it. Equity professionals Alex Rampell and Scott Kupor investigate changes in the financial landscape and offer strategic insights to financial professionals, investors and entrepreneurs.

About the Authors

Alex Rampell and Scott Kupor are partners at Andreessen Horowitz.


The initial public offering has its detractors, but it remains the primary platform for companies “going public.”

The IPO is a staple mechanism by which a new company raises capital in the public markets. Yet underwriters can set an IPO list price too low, and with typical investor demand often reaching 50 times the amount of shares issued, the stock can roar to the upside by a factor of 50% to 200%. The upshot is the impression that the company could have captured more capital had the IPO been priced correctly. 

Critics point to this as evidence that Wall Street purposely sets the equity price...

Comment on this summary

More on this topic

By the same authors

Secrets of Sand Hill Road
Investment Banking Explained
What Is A SPAC?
Waiting for the Last Dance
Too Smart for Our Own Good
One Hour Investor
The Myth of Capitalism

Related Channels