An initial public offering—also known as an IPO—is the process by which a privately-owned/privately-held company begins selling stock to outside investors, and transforms the company from a private company to a public company. Shares of public companies (also called publicly-traded companies) are usually traded on one of two stock exchanges—the New York Stock Exchange or the Nasdaq. A public company can raise money (capital) it needs by issuing and selling shares of its stock on the stock exchange on which it is listed. But public companies must comply with significant reporting and disclosure requirements established by the U.S. Securities and Exchange Commission that private companies do not have to comply with.

In Colorado, as in other states, an initial public offering (IPO) is governed primarily by federal securities laws, particularly the Securities Act of 1933 and the Securities Exchange Act of 1934, which are enforced by the U.S. Securities and Exchange Commission (SEC). These laws require companies to file registration statements and prospectuses detailing financial and other significant information about the company, to ensure that investors can make informed decisions. The company must also meet the listing requirements of the stock exchange it chooses, whether it's the New York Stock Exchange or Nasdaq. Once public, the company is subject to ongoing reporting obligations, such as filing annual and quarterly reports (10-K and 10-Q forms), and compliance with regulations regarding insider trading, disclosure, and corporate governance. While Colorado state law also has securities regulations, known as 'blue sky laws,' these are generally preempted by federal law in the case of IPOs and other transactions involving nationally traded securities. However, state law may still apply in certain circumstances, and companies must ensure compliance with both federal and state regulations when conducting an IPO.