> So basically the IPO is a way to formalize the initial price of the stock.
no. it is the company selling their stock to the public for the first time, to raise cash. the company chooses a price it is willing to sell at.
further, "formalizing" the price of the stock isn't a thing. the price of the stock is whatever somebody will sell it to you for.
> By bypassing that process, they will sell for whatever the market dictates for better or worse, is that correct?
once the stock is on the market, it sells for whatever someone will buy it. the IPO happens shortly before it hits the market.
> Additionally, is it possible that all private share holders could prior to first day of listing come to an agreement on a minimum price they would sell for?
sure, they could. but there are probably already hundreds or thousands of them.
> no. it is the company selling their stock to the public for the first time, to raise cash.
That's incorrect. The company is not raising cash with this IPO. The insiders are doing the IPO to sell, which should tell you what's actually going on. By direct listing, they avoid the traditional lock-up, so they can liquidate immediately.
The comment you're replying to is describing a regular IPO, and is not incorrect. The direct listing process is not a type of IPO; it's skipping the IPO.
no. it is the company selling their stock to the public for the first time, to raise cash. the company chooses a price it is willing to sell at.
further, "formalizing" the price of the stock isn't a thing. the price of the stock is whatever somebody will sell it to you for.
> By bypassing that process, they will sell for whatever the market dictates for better or worse, is that correct?
once the stock is on the market, it sells for whatever someone will buy it. the IPO happens shortly before it hits the market.
> Additionally, is it possible that all private share holders could prior to first day of listing come to an agreement on a minimum price they would sell for?
sure, they could. but there are probably already hundreds or thousands of them.