Mel Lavitt, one of the architects of the modern IPO marketing process and a veteran of some of the most consequential public offerings in history, recently joined ICAN’s Capital Ideas podcast to discuss how the IPO market evolved from a relationship-driven ecosystem of small firms and emerging companies into today’s highly institutionalized capital formation machine.
Drawing on decades of firsthand experience – including helping take Intel public in 1971 – Lavitt offered a rare oral history of Wall Street during the formative years of the modern IPO market.
When Lavitt and his colleagues at C.E. Unterberg Towbin brought Intel public, the company was valued at roughly $50 million and raised approximately $8 million in its IPO.
Today, Intel is worth more than $400 billion. A $1,000 investment in Intel’s IPO would now be worth millions of dollars after accounting for stock splits and appreciation.
For Lavitt, Intel represents more than just a successful deal. It symbolizes an era when companies routinely entered the public markets much earlier in their growth cycle – allowing ordinary investors to participate in transformative wealth creation long before companies reached trillion-dollar valuations.
Capital Ideas co-host and ICAN Senior Legal Director Mark Hiraide noted that many of today’s most valuable companies now remain private until much later stages of development, fundamentally changing who gets access to early-stage growth opportunities.
“We’ve effectively shifted the most valuable part of the growth curve away from the public markets,” Hiraide observed during the discussion. “Retail investors used to be able to participate much earlier in a company’s lifecycle.”
“The game has changed,” Lavitt explained. Because companies today have a lot more ability to find money in private markets than they used to, they’ll stay private as long as they can while waiting for what Lavitt called “the huge IPO.”
That shift formed the central theme of the conversation. In the 1970s and 1980s, IPOs were often small offerings handled by lean firms operating with remarkably limited infrastructure by today’s standards.
“We were all in one room,” Lavitt recalled of his early years at Unterberg. “Including our trading desk.”
The smaller scale of the business fostered a highly personal market culture – one built around trust, relationships, and reputation rather than sheer size and institutional dominance.
“Back then, everybody knew everybody,” Lavitt said repeatedly throughout the interview. “You were doing business with people you knew or people you got to know really well.”
That relationship-driven culture also gave rise to one of Wall Street’s most enduring innovations: the IPO roadshow.
As institutional interest in emerging growth companies expanded beyond New York, Lavitt and his colleagues realized they needed a way to introduce deals to investors in other cities.
“I remember on one of the deals, I said, ‘How do we let other people know we’re doing this?’ It became the roadshow,” Lavitt explained.
The roadshow transformed the IPO process by allowing bankers and management teams to directly market companies to investors across the country. Boston, San Francisco, and Chicago became critical stops in cultivating institutional demand. What is now viewed as a standard part of the IPO process was, at the time, a radical innovation.
Lavitt also discussed the critical role conferences played in investor relations and market development – particularly during the 1990s technology boom.
Dara Albright, co-host of Capital Ideas and an ICAN board member who worked for Lavitt in the 1990s, recalled Wall Street’s first Space & Satellite Conference in 1996. Following a presentation by CD Radio – today known as SiriusXM – portfolio managers rushed to payphones at New York’s Grand Hyatt Hotel to place buy orders with their trading desks while stock quotes updated live on Quotron machines nearby.
For Lavitt, conferences were about much more than marketing deals.
“At these conferences, you met a lot of people, you built relationships,” he said. “If you have more people you can pick up the phone and call than the next guy, you’re ahead of the game.”
The conversation also explored how IPO syndicates evolved over the decades. In the early years, syndicates often involved broad participation from numerous firms, each receiving relatively small allocations. Today, underwriting has become increasingly concentrated among a handful of dominant financial institutions.
At the same time, the scale of institutional capital has dramatically increased.
“Many retail investors today probably have more money than institutions had back then,” Lavitt observed while discussing the growth of small-cap funds and modern market participants.
Yet despite the vast increase in available capital and technological sophistication, Lavitt repeatedly returned to the same conclusion: modern markets have become less personal.
“It used to be that firms were doing business with friends. Today, firms are just doing business.”
The episode ultimately closed on a surprisingly optimistic note. While much of the relationship-driven culture of early Wall Street may have disappeared from traditional public markets, Capital Ideas co-host Nick Morgan suggested that those same personal dynamics may simply have migrated elsewhere – particularly into crowdfunding, venture communities, and relationship-based private capital networks.
“The relationship-driven part of the market hasn’t disappeared,” Morgan observed. “It may have simply moved elsewhere.”
In many ways, that observation encapsulated the broader message of the episode: although the structure of capital formation has changed dramatically over the past half century, the importance of trust, relationships, storytelling, and community in financing innovation remains as relevant as ever.
Nick Morgan is President and Founder of ICAN, the Investor Choice Advocates Network, a nonprofit public interest litigation organization dedicated to serving as a legal advocate and voice for everyday investors and entrepreneurs. He was previously a partner in the Investigations and White Collar Defense Group at the Paul Hastings law firm. Morgan previously served as Senior Trial Counsel in the SEC’s Division of Enforcement. Capital Ideas is a series created by Morgan and Dara Albright.