The investment bank&#x27;s fee is a percentage of the proceeds (typically around 7%), so you&#x27;re saying that they gave up millions of dollars as a favor to their &quot;friends&quot;. I think it&#x27;s more likely some combination of:<p>a) they screwed up (60% is too high);<p>b) they have to balance making as much money as possible (=&gt; high price), and not ripping off the investors they hope will participate in future IPOs (=&gt; low price); and<p>c) current shareholders want a healthy secondary market and a good collection of longer-term shareholders, even if that means getting paid somewhat less for the ~5% of the company they just sold off.