WHAT IS AN IPO (INITIAL PUBLIC OFFERING)?
Imagine you and your friends have a lemonade stand. At first, you and your family pay for everything; lemons, sugar, cups, so you own the whole business. But one day, you want to make your stand bigger, buy better ingredients, and maybe even open more stands.
Since you don’t have enough money yourself, you decide to sell small parts of your business (called shares) to other people. In return, they give you money to help your business grow.
When a big company does this for the first time, it’s called an IPO (Initial Public Offering). They sell shares to the public on the stock market, allowing regular people to buy a small piece of the company. If the company does well, those shares can become more valuable, and the people who bought them can make money!