This paper analyzes the determinants of initial public offerings (IPOs) and their consequences on a company's investment and financial policies. It compares the ex ante and ex post characteristics of IPOs with those of a large sample of privately held companies. The study finds that the likelihood of an IPO is positively related to the market-to-book ratio in the relevant industry and company size. IPOs are followed by an abnormal reduction in profitability, and the new equity capital raised is not used for investment or growth but to reduce leverage. Going public reduces the cost of bank credit and is often associated with equity sales by controlling shareholders, leading to higher turnover of control. The paper also finds that IPOs are associated with a reduction in investment and financial leverage, and that independent companies are more likely to go public after major investments and abnormal growth. The study uses a dataset of Italian companies, which includes financial information for both publicly traded and privately held firms, to analyze these determinants. The findings suggest that the decision to go public is not a universal stage but a choice influenced by factors such as market-to-book ratio, company size, and the need for external financing. The study also highlights the importance of understanding the functions of stock exchanges as a source of capital. The paper concludes that the decision to go public is influenced by a combination of factors, including the need for external financing, the desire to reduce leverage, and the benefits of increased transparency and access to capital markets.This paper analyzes the determinants of initial public offerings (IPOs) and their consequences on a company's investment and financial policies. It compares the ex ante and ex post characteristics of IPOs with those of a large sample of privately held companies. The study finds that the likelihood of an IPO is positively related to the market-to-book ratio in the relevant industry and company size. IPOs are followed by an abnormal reduction in profitability, and the new equity capital raised is not used for investment or growth but to reduce leverage. Going public reduces the cost of bank credit and is often associated with equity sales by controlling shareholders, leading to higher turnover of control. The paper also finds that IPOs are associated with a reduction in investment and financial leverage, and that independent companies are more likely to go public after major investments and abnormal growth. The study uses a dataset of Italian companies, which includes financial information for both publicly traded and privately held firms, to analyze these determinants. The findings suggest that the decision to go public is not a universal stage but a choice influenced by factors such as market-to-book ratio, company size, and the need for external financing. The study also highlights the importance of understanding the functions of stock exchanges as a source of capital. The paper concludes that the decision to go public is influenced by a combination of factors, including the need for external financing, the desire to reduce leverage, and the benefits of increased transparency and access to capital markets.