An IPO signals a private company going public, by offering its shares out to members of the public. Typically, this will be presented by new companies aiming to secure investors and capital, though this isn’t always the case. Older, more established private companies may tender an IPO if they want to be listed on the stock exchange, or if they need to raise funds to pay off debts, among other reasons. Since the ipo definition is that the stock is new to the market for the first time, the company behind the IPO does not have a proven track record. Therefore, as an investor, an ipo means more risk, but potentially more reward in terms of profit. Most IPOs will be underwritten by investment companies or banks, who transfer underwriting fees onto the price presented to investors.