Follow-on Offering

A follow-on offering is when a company that's already publicly traded issues and sells new shares to raise more cash. Think of it as a second (or third, or tenth) round of fundraising after the company's initial public offering, or IPO. You'll see these announced in financial news, and they matter because they can dilute existing shareholders' ownership stakes—meaning your slice of the company gets slightly smaller. For example, if TechCorp issues 10 million new shares when 100 million already exist, every shareholder's percentage ownership drops by about 9%. Companies do this to fund expansion, pay off debt, or make acquisitions. It's a normal part of how public companies grow.