Initial Public Offering is the first stock which a company puts up for sale when it goes public. This is when a privately held company turns into a public entity and its shares are traded on the stock exchange. The company shares its ownership when it becomes a public company. Once the shares go public the company then allots it to the investors based on the demand for the shares. When the IPO Process is on, a small set of shares are reserved for different kinds of investors. They include investors like Individual or retail investors, Institutional buyers who are qualified and High Net worth Individuals. If you want to invest in an IPO you need to do deep research about the company you want to buy shares of. You need to check their historical records in terms of their IPO. You should see if their promoters are reliable or not. The products offered by the company should have a good potential for growth. Read the prospectus carefully.