An IPO allows a company to raise a large amount of money by selling issued shares to the general public. Far more people with far more total money can invest in public markets and so companies can generally raise significantly more money through IPOs than through private equity, in which shares are sold to specific accredited investors, not on the open market. This lets the company tap into a large amount of money that can be used to grow and improve its business, while early investors can usually make a profit by selling the shares they purchased when the company was still in its earlier stages. However, when a company goes public, they are then answerable to a much larger group of shareholders.