What is Pre-IPO?
Pre-IPO refers to the period when a company is still privately held and raising capital or allowing share transfers before it makes a public offering. During this time, companies are not yet traded on public exchanges. In investing terms, “pre-IPO” also describes the process of acquiring shares in such private firms ahead of their initial public offering (IPO), typically in late-stage rounds or secondary transactions, with hopes those shares will grow in value once the company goes public.
The pre-IPO space has grown as companies have, on average, opted to stay private for longer. This extension of the private market runway has allowed for increased value creation to take place before companies become public, which is appealing to the growing cohort of investors interested in pre-IPO deals.