What is a lockup period?

A lockup period is a window of time after an IPO during which existing shareholders, including SPV investors, cannot sell their shares. Lockups exist to prevent a large volume of selling immediately after listing, which could pressure the stock price.

The standard lockup is 6 months, but terms vary. Some IPOs feature shorter or tiered lockups that allow partial selling if the stock hits certain price targets. In direct listings, where a company lists existing shares without raising new capital, there is typically no lockup and investors can sell from day one.

The lockup terms for your investment are governed by the lockup agreement, which applies to the SPV as a whole.