This paper empirically analyzes the determinants of initial public offerings (IPOs) and the consequences of this decision on a company's investment and financial policy. The authors compare the ex ante and ex post characteristics of IPOs with those of a large sample of privately held companies of similar size. They find that the likelihood of an IPO is positively related to the market-to-book ratio and the company's size. IPOs are followed by an abnormal reduction in profitability, and the new equity capital raised is used to reduce leverage rather than for subsequent investment and growth. Going public also reduces the cost of bank credit and is often associated with equity sales by controlling shareholders, leading to higher turnover of control. The study uses a unique dataset of Italian companies, which includes financial information for both publicly traded and privately held firms, to overcome the lack of data on non-IPO companies. The findings suggest that the decision to go public is influenced by factors such as market-to-book ratio, company size, and the desire to rebalance the balance sheet after major investments. The study also documents a reduction in profitability, investment, and financial leverage after an IPO, and an increase in the cost of bank credit for independent IPO firms.This paper empirically analyzes the determinants of initial public offerings (IPOs) and the consequences of this decision on a company's investment and financial policy. The authors compare the ex ante and ex post characteristics of IPOs with those of a large sample of privately held companies of similar size. They find that the likelihood of an IPO is positively related to the market-to-book ratio and the company's size. IPOs are followed by an abnormal reduction in profitability, and the new equity capital raised is used to reduce leverage rather than for subsequent investment and growth. Going public also reduces the cost of bank credit and is often associated with equity sales by controlling shareholders, leading to higher turnover of control. The study uses a unique dataset of Italian companies, which includes financial information for both publicly traded and privately held firms, to overcome the lack of data on non-IPO companies. The findings suggest that the decision to go public is influenced by factors such as market-to-book ratio, company size, and the desire to rebalance the balance sheet after major investments. The study also documents a reduction in profitability, investment, and financial leverage after an IPO, and an increase in the cost of bank credit for independent IPO firms.