When two persons decide on a business venture they start with their own funds. When the business grows it requires more funds from outside in the form of equity or borrowing funds from other people. When people invest in IPO they become the shareholder of the companies and help the companies to grow. So in order to raise the funds from the public, the company needs to get listed or become a public limited company. Thus, the process by which a private company becomes a public limited company by the sale of its stocks to the general public for investment is known as Initial Public Offering or IPO.