Most of what the public knows about a private company before it goes public comes from one document. The S-1 is a regulatory filing where a company that has spent years saying little is required to make disclosures about its business: how it makes money, how much it loses, risks to the business, detailed description of the business model and various business segments, who owns it, and what could go wrong. For investors in the pre-IPO secondary market, it is also the first time a company publicly discloses audited financials which can be reviewed against previously reported funding rounds and recent private security transactions.
This guide covers what an S-1 filing is, how a confidential S-1 filing works, what the review process looks like, and what the document can and cannot tell a secondary investor.
Form S-1 is the registration statement a company files with the Securities and Exchange Commission to register securities for sale to the public under the Securities Act of 1933. For a U.S. company doing a traditional IPO, it is the document that starts the process. The SEC reviews it, the company revises it, and once the SEC declares it effective, the shares can be sold to public investors.
The S-1 has two parts. Part I is the prospectus, the portion that goes to investors and that most people mean when they say "the S-1." Part II holds supporting material: exhibits like the company's charter, material contracts and underwriting agreements, plus information the SEC requires but that does not go in the prospectus.
The prospectus follows a set structure, and the sections investors read most are these.
The business description explains what the company sells, to whom, how it competes, and how it plans to grow. The risk factors section lists what could hurt the business, from customer concentration to pending litigation to the fact that the stock has never traded publicly. Some risks are broad (geopolitical risk, for example), but some risks are narrow and specific to the business so pay special attention to those.
Financial statements are audited and typically cover the past two or three fiscal years, with interim quarters where the filing date requires them. Management's discussion and analysis (MD&A) walks through those numbers in prose, which is where a company explains why revenue moved and what it expects to drive it next.
Use of proceeds states what the company plans to do with the money it raises. "General corporate purposes" is common and tells you little. A specific allocation to debt repayment or an acquisition tells you more.
The filing also covers dilution, capitalization, executive compensation, principal shareholders, related-party transactions, and the underwriting arrangement. An S-1 is long because it contains a lot of detail and disclosures about the business and its risks. The rules exist so that a public investor has full and fair disclosures before deciding whether to invest.
A confidential S-1 filing is a draft registration statement submitted to the SEC for nonpublic review before the company files anything publicly. The SEC reviews the draft and sends comments the same way it would for a public filing, but nothing appears on EDGAR until the company chooses to file publicly and the company can resubmit as needed.
The option began with the JOBS Act in 2012, which let emerging growth companies (generally, companies below a revenue threshold the SEC sets, currently $1.235 billion) submit draft registration statements confidentially. In 2017, the SEC's Division of Corporation Finance extended nonpublic review to all companies for an IPO, regardless of size. Many IPO candidates now start this way.
The company submits its draft S-1 through EDGAR as a draft registration statement, usually abbreviated DRS. SEC staff review it and issue comment letters. The company responds and submits amended drafts. All of this stays nonpublic.
At some point the company decides to publicly file its S-1. Under current rules, the registration statement and all prior confidential drafts must be filed publicly at least 15 days before the company begins its roadshow, or, if there is no roadshow, at least 15 days before the requested effective date. When that public filing happens, the earlier drafts and the SEC's comment letters eventually become visible on EDGAR too, so the confidential process delays disclosure rather than avoiding it.
Two reasons dominate. The first is timing. A company that files publicly and then decides the market is wrong, or that its numbers need another quarter, has to withdraw in full view. A company in confidential review can simply wait, and the news that it ever submitted a draft may stay private. Reporting on companies that have "confidentially filed" usually comes from the company itself or from other public sources, since the SEC does not announce submissions.
The second is competitive exposure. The S-1 discloses pricing, margins, customer concentration and strategy that a company may prefer its competitors not read for any longer than necessary. Confidential review shortens the window between that disclosure and the effective date of the securities.
There is a cost. Investors, employees and secondary market participants have less visibility into where a company stands. A confidential filing can sit with the SEC for months, and the company may never publicly file.
The sequence below is for a traditional underwritten IPO by a U.S. company. Direct listings also use Form S-1, with some differences in the offering sections.
The company, its counsel, auditors and underwriters assemble the draft. The company submits it to the SEC as a DRS. Nothing is public yet. Before this point the company has typically chosen its lead underwriters and held an organizational meeting, and the drafting itself can take months.
The SEC's Division of Corporation Finance reviews the submission and sends a comment letter, usually within about 30 days of the initial submission. Comments can ask the company to clarify a risk factor, support a claim in the business section, change an accounting treatment, or add disclosure the staff thinks is missing. The company responds in writing and files an amended draft. Several rounds are normal. Review is complete when the staff has no further comments, and the comment letters and responses are later released on EDGAR, no earlier than 20 business days after the registration statement becomes effective. The SEC’s review is not a review of whether the company is good or bad, it is limited to the required disclosures and ensuring the company’s S-1 includes complete information. An effective registration statement is not an endorsement of the company by the SEC.
The company publicly files the S-1, which is when most people first see it. From here, amendments are filed as S-1/A. The first public filing often omits the price range and share count; a later amendment adds them, usually just before the roadshow. During the roadshow the underwriters build the order book. The SEC then declares the registration statement effective, the offering prices, and the company files a final prospectus with the price. Trading begins the next day.
Companies that decide not to proceed can withdraw the registration statement by filing a Form RW. That happens, and the reason is not always disclosed.
For a fuller picture of the IPO sequence beyond the filing itself, see what really happens when a startup IPOs.
The S-1 is the first time the public can review audited financial statements and funding for a company that may have been raising private capital for a decade. That makes it one of the most useful documents for anyone who holds, or is considering, a position in its shares.
Read the business section for how the company describes its own revenue. Is it subscription, usage-based, transactional, or a mix? How concentrated is it? Does the company disclose net revenue retention, gross margin by segment, or customer counts, and do those numbers match what has been reported privately? The risk factors are where the company is required to disclose all material risks to its business. Litigation, regulatory exposure, dependence on a single supplier or platform, and governance arrangements that limit public shareholders all show up here.
Audited financials supersede the figures that circulated in funding announcements and press coverage. Revenue growth, operating losses, cash burn and the balance sheet are all there. The use of proceeds section indicates whether the IPO is primarily growth capital, a chance for existing holders to sell, or a way to pay down debt. Many filings also disclose how much of the offering consists of secondary shares sold by insiders.
The cover page lists the underwriters. The capitalization and description of capital stock sections explain the share classes, voting rights, and what happens to preferred stock at the IPO. Many venture-backed companies convert all preferred shares to common at the offering, and the S-1 shows the conversion ratios. Dual-class structures, where founders hold shares with more votes per share, are disclosed here, along with any lockup agreements between the underwriters and existing holders.
For investors who buy and sell private company shares, the S-1 changes the picture in a few concrete ways.
Once a company is in a cooling off period, secondary transfers of its stock often slow or stop. Companies and their counsel typically limit transfers in the months before an IPO, and the company's board often retains approval rights over most transactions under its bylaws and shareholder agreements. A secondary investor who buys in the window between a confidential filing and the public filing may not know the confidential filing exists.
After the IPO, pre-IPO holders are usually subject to a lockup, a contractual agreement with the underwriters not to sell for a set period, most commonly 180 days. The lockup terms are disclosed in the S-1. Some recent IPOs have used staggered or performance-based releases that let a portion of shares trade earlier. For what happens when those restrictions lift, see our guide to IPO lockup expiration.
Lockups also matter for pricing. An S-1 that discloses a large block of secondary shares in the offering, or an unusually short lockup, tells investors something about how much supply may hit the market and when.
The S-1 tells you what the company has disclosed as required by securities law. It gives audited numbers, a management narrative, and a list of risks. It discloses who the underwriters are and how the share structure works.
It does not tell you whether the IPO will happen. An effective registration is not an endorsement of the company by the SEC. Companies withdraw, and some sit in confidential review for a year or more. It does not tell you the IPO price until a late amendment, and even then the range can move. And it does not tell you what the shares will trade at after the offering, a question that has produced some expensive surprises in both directions. Our coverage of how Figma's IPO left billions on the table looks at one case where the private market and the public market disagreed sharply about value.
Secondary investors should also remember that private share prices and S-1 financials can diverge. A company may have raised at one valuation, traded in the secondary market at another, and then disclosed financials in the S-1 that support neither. For context on how IPO delays are reshaping private market liquidity, see our Pulse analysis.
A company that has filed an S-1 is still a private company. Until the registration statement is effective and shares are trading on an exchange, the company remains private and its shares remain subject to the transfer restrictions and accredited investor requirements that govern private securities. Our guides to SEC rules for private companies and Regulation D and accredited investors cover that framework.
Augment operates a private marketplace for pre-IPO shares and a private company investment platform that pools investor capital into special purpose vehicles.
When a company's filing status is public, Augment shares that information as reported. A public S-1 on EDGAR is a fact; a report of a confidential submission is a news item, and Augment labels it as such. Augment does not have access to nonpublic information about confidential filings and does not speculate about them.
Augment's research, including The Pulse newsletter and the quarterly Power 20 ranking of pre-IPO companies, is intended to support investors doing their own work on private companies. That includes reading an S-1 when one is available and comparing it to the estimated prices and trading activity visible on the platform.
A pending S-1 does not mean an IPO will happen, when it will price, or what the shares will be worth afterward. Augment does not represent otherwise. Private securities are illiquid and can lose value, and a filing can be withdrawn at any stage. Investors should read our guide to preparing for an IPO as an investor and consult their own advisors before making decisions.
The S-1 is the core disclosure document for going public. It is where a private company's financials have been audited and put on the public record, and where the risks to the business get written down. Confidential filing lets a company work through comments with the SEC before filing anything publicly, which is why most IPO candidates now start their review in private and why a company can be months into the process before anyone outside it knows.
For a secondary investor, the document is a check on everything that came before it. Reviewing an S-1 is one of the most detailed ways to understand a company and one way to evaluate whether the historic price the private market has been paying aligns with the audited financials.
An S-1 is the registration statement a company files with the SEC to register securities for public sale under the Securities Act of 1933. It contains the prospectus, including the business description, risk factors, audited financial statements, use of proceeds, management and ownership information, and details of the offering. The SEC must declare it effective before the shares can be sold publicly. An effective registration is not an endorsement of the company by the SEC.
A confidential S-1 filing is a draft registration statement submitted to the SEC for nonpublic review. The SEC reviews it and sends comments, but nothing appears on EDGAR until the company files publicly. The company must file publicly at least 15 days before its roadshow begins. The option was created by the JOBS Act in 2012 for emerging growth companies and extended to all companies by the SEC in 2017.
The SEC's Division of Corporation Finance typically issues its first comment letter within about 30 days of the initial submission. Subsequent rounds may move faster, often in a couple of weeks each. The full process from first submission to effectiveness commonly takes three to six months, though it varies with the complexity of the filing, the number of comment rounds, and how long the company chooses to wait between the end of review and the public filing.
A U.S. company conducting a registered IPO must file a registration statement, and for most operating companies that is Form S-1. There are other forms for specific situations: foreign private issuers use Form F-1, real estate companies use Form S-11, and companies going public through a merger via a SPAC register the transaction on Form S-4. Smaller offerings under Regulation A use Form 1-A rather than S-1. Direct listings, where a company lists without an underwritten offering, still require a registration statement on Form S-1.
Get started today — explore pricing, offerings, and submit your first order.
FOR QUALIFIED INSTITUTIONAL AND ACCREDITED INVESTORS ONLY: Under federal securities laws, private market investments on this platform are available exclusively to Institutional and Accredited Investors. Verification of status required before investing. Private investments involve significant risks including illiquidity, potential loss of principal, and limited disclosure requirements. "Augment" refers to Augment Markets, Inc. and its affiliates. Augment Markets, Inc. is a technology company offering software and data services, not a bank or financial institution. Cash Accounts are provided by Modern Treasury Corp. financial institution partners and through Augment's technology. Augment does not act as a money services business, provide money transmission, or serve as a custodian of funds. Funds held in your Cash Account are not FDIC insured unless expressly disclosed. Full terms available in the Augment Cash Account Agreement.Brokerage services are offered through Augment Capital, LLC, an affiliated broker-dealer and member FINRA/SIPC. “Investment accounts” are not brokerage accounts and do not hold customer funds or securities. Investment advisory services are offered through Augment Advisors, LLC, an SEC-registered investment adviser. Registration with the SEC does not imply a certain level of skill or training. Augment and its affiliates do not provide legal or tax advice; consult your attorney or tax professional regarding your specific situation. For additional information, please refer to Augment Advisors, LLC’s Form ADV Part 2A (Firm Brochure) and FINRA BrokerCheck.
