the.com/lockup
The part of an IPO where insiders smile for cameras but can't sell a single share.
means A contractually fixed period after a company goes public during which insiders and early investors are barred from selling their shares.
from Straightforward compound of 'lock' and 'up' — the sense of 'lock up' meaning to secure or immobilize something dates back centuries in English. Its financial use emerged as IPO practice formalized the restriction: underwriters write a lockup clause into the deal so founders and venture investors can't dump stock the moment it starts trading, which would spook the very buyers they just courted. The word just describes what it does — the shares are, quite literally, locked up.
- typical length
- Usually 90 to 180 days post-IPO
- expiration effect
- Stock often drops as insiders finally cash out
- not optional
- Set by underwriters, not founders' goodwill
- other meaning
- Also slang for a jail cell