The banks care because they do this all the time. One way they convince people to buy into the shitty IPOs is to also get them access to the good ones. Then the bank can make the fees from taking shitty companies public without upsetting the investors who buy those shitty IPOs.
An individual company is not part of an iterative game but the underwriters and institutional investors are, and it creates misaligned incentives.
It’s the reason for the hype around direct listings. So far no one has raised money that way but it’s only a matter of time. The difference is between floating publicly and floating publicly with a raise is basically nothing.
An individual company is not part of an iterative game but the underwriters and institutional investors are, and it creates misaligned incentives.
It’s the reason for the hype around direct listings. So far no one has raised money that way but it’s only a matter of time. The difference is between floating publicly and floating publicly with a raise is basically nothing.