The IPO process, step by step

The IPO process is choreographed in a way that has barely changed in three decades, even as the underlying technology, regulation, and investor base have all moved. This guide walks through each phase the way a CFO and an issuer counsel actually experience it.

1. Pre-filing: organize the company

Before an IPO can happen, the company has to be ready. That means:

• Audited financials under PCAOB standards for at least two years (three for non-EGCs).
• A board with the requisite independent directors and audit-committee composition.
• Internal controls and a SOX 404 readiness plan.
• A clean cap table and equity-incentive plan suitable for a public company.

This phase often takes 9–18 months and is the unglamorous foundation of everything that follows.

2. Selecting bankers and counsel

In a so-called bake-off, the company invites investment banks to pitch. The lead-left bookrunner — listed first on the S-1 cover — runs the book and the pricing call; one or more additional bookrunners share the work. Issuer counsel drafts the S-1; underwriters' counsel represents the syndicate.

Look at any recent IPO's cover and you will see the same handful of names: Goldman Sachs, Morgan Stanley, J.P. Morgan, BofA Securities, Citi, Barclays.

3. Drafting the S-1

The S-1 is the single most important document in the deal. It contains the prospectus that will be in front of every investor. Drafting takes 8–12 weeks of weekly all-hands sessions and is led by issuer counsel. See S-1 explained for what is inside.

4. Filing and SEC review

The S-1 is filed with the SEC — publicly, or confidentially under the JOBS Act for emerging growth companies. The SEC reviews the filing and issues comment letters; the company responds with amendments (S-1/A) until comments are cleared.

5. Roadshow and bookbuilding

With a clear S-1 and a marketing range on the cover, management goes on the road. The lead bankers organize meetings with portfolio managers; demand is collected in the book and updated daily.

6. Pricing

On the night before listing, the syndicate holds a pricing call with the issuer's board. Based on the size and quality of demand, they recommend a final price and allocation. The company signs the underwriting agreement; the 424B pricing prospectus is filed.

7. Listing day

The shares list the next morning. The exchange's designated market maker (NYSE) or lead market maker (Nasdaq) runs an opening cross to determine the first trade. From that moment forward, the company is public.

8. After the IPO

The newly public company is now subject to ongoing SEC reporting (10-Q, 10-K, 8-K), exchange rules, and the discipline of quarterly earnings. The lockup period — typically 180 days — restricts insider selling. The first earnings call is usually a major test of management's relationship with public investors.