A cornerstone investor is a major shareholder who holds a relatively large stake in a company prior to its IPO. This prior and off-market purchase of shares is often additionally linked to a so-called lock-up period. This refers to a time frame of between 6 and 18 months, during which the major shareholder is not allowed to sell his shares after the IPO. Overall, cornerstone investors are intended to lend more stability and confidence to the upcoming IPO and help the share price to be less volatile in the first weeks after the IPO.
