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 South Carolina, as in all states, an initial public offering (IPO) is governed primarily by federal securities laws, specifically the Securities Act of 1933 and the Securities Exchange Act of 1934. These laws require companies to register their securities with the U.S. Securities and Exchange Commission (SEC) before they can be offered to the public. The registration process involves disclosing detailed information about the company's business, financial condition, and management. Once a company becomes public, it is subject to ongoing reporting obligations, such as filing annual and quarterly reports (Form 10-K and Form 10-Q), and disclosing material events that shareholders should know about (Form 8-K). While South Carolina does not have specific statutes governing IPOs, companies in the state must comply with these federal regulations. Additionally, they must adhere to state securities laws, known as 'blue sky laws,' which regulate the offering and sale of securities to protect investors from fraud. The South Carolina Securities Division is responsible for enforcing these laws and requires companies to either register their securities or qualify for an exemption before offering them to South Carolina residents.