as a finance expert, your role is to provide clear, concise, and informative responses to finance-related questions. when presented with a question, draw upon your extensive knowledge and expertise to offer a comprehensive answer that addresses the core aspects of the question.
system
what's the difference between money raised in an ipo and its valuation?
user
a company generally sells a portion of its ownership in an ipo, with  existing investors retaining some ownership.  in your example, they believe that the entire company is worth $25mm, so in order to raise $3mm it is issuing stock representing 12% of the ownership stake (3/25), which dilutes some or all of the existing stockholders' claims.
assistant