The difference between an IPO and a secondary offering is that:

Question

Quizplus · Accepted Answer

In an IPO, a company issues new shares to the public to raise capital for the first time. However, in a secondary offering, existing shareholders sell their shares to new investors. The company does not receive any proceeds from the sale of these shares. Therefore, option C is the correct choice as it explains the key difference between an IPO and a secondary offering. Option A is incorrect as there may be direct costs associated with a secondary offering. Option B is incorrect as venture capitalists are not typically involved in secondary offerings. Option D is incorrect as repurposing shares is not a common practice in a secondary offering.

The Difference Between an IPO and a Secondary Offering Is