An IPO lock-up is a term that might be included in an IPO purchase contract that prevents people who bought IPO shares from selling them for a set time. The waiting period varies case by case but might typically be 180 days long. A lock-up agreement might also limit the number of shares an investor could sell at one time. Lock-up periods are critical when investing in an IPO company because share prices may drop dramatically in anticipation of a rush to sell once the lock-up period expires.