--- title: Why Should I Care About IPOs? description: In this episode of Dumb Money, Taylor Tepper explains what happens to a stock after an initial public offering, and why you should care. authors: - name: Taylor Tepper url: https://money.com/author/taylor-tepper-3/ at_money_since: 2013 articles: 168 covers: - Investing - Banking - Business - Career Advice - Credit - Credit Cards - Economy and Politics - Education - Housing - Identity Theft - Insurance - Lifestyle - Loans - Mortgages - Personal Finance - Retirement - Shopping - Taxes social: - https://x.com/TaylorTepper former_staff: true published: '2016-05-19T20:30:08.000Z' modified: '2024-04-02T04:51:51.000Z' section: Investing tags: - bonds - buying - dumb money - Initial Public Offering - Investing - IPO - Money - Spending - stocks - taylor tepper - value - video - wall street word_count: 228 canonical: https://money.com/company-stock-ipo-initial-public-offering/ type: Article source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Screen Shot 2016-05-18 at 3.02.48 PM](https://img.money.com/2016/05/screen-shot-2016-05-18-at-3-02-48-pm.png) Why should you care? Because your wealth depends on it! Okay, let’s back up. An IPO, or [initial public offering](http://www.investopedia.com/terms/i/ipo.asp), is the beginning of a company’s life as a public company, not the end. When a private company wants to go public, it pays an investment bank to help sell those shares. The bank works with the company to figure out how many shares it should offer up to investors, and at what price. After the IPO, investors buy and sell shares of a company. If the [stock](https://money.com/collection-post/what-is-a-stock/) is in demand, if a lot of people want to buy it, the price will go up. If no one wants what they’re selling, then the price will go down. You should care about the price of a stock that you own because you want the price to go up! If you buy a stock at $5 a share, and then sell it at $10, then you’ve made a big profit. You can also make money along the way if the company whose stock you own pays you dividends, or a share of its profits. That’s the point of long-term investing: owning stocks, or better yet [low-cost mutual funds](https://money.com/money-50-best-mutual-funds-etfs-2016/), for decades in the hope that they will share profits with you and be more valuable when you decide to sell. 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