Initial public offerings used to offer investors chances to get in on the ground floor of young, fast-growing companies. There was risk, of course, but also the possibility of enormous rewards. Amazon.com went public in May 1997, less than three years after it was incorporated, and has since returned almost 24,000 percent to people who got in at the IPO price. These days IPO investors are more likely to get in somewhere around the sixth floor, when companies are well beyond infancy and maybe approaching middle age. Alibaba Group Holding, the Chinese Internet giant, is a case in point. Founder Jack Ma has waited 15 years to take it public, raising money along the way from Yahoo! and SoftBank. The company's IPO on the New York Stock Exchange later this year could value it at $150 billion, making it the biggest in U.S. history.
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