W.R. Hambrecht auctioned IPOs so small investors could bid too.

Traditional IPOs were priced by underwriters and shares allocated to favored institutional clients, who often flipped them for a quick gain while the issuing company left money on the table. W.R. Hambrecht & Co. built OpenIPO to run the offering as an online Dutch auction open to any investor.

Andover.net's December 1999 offering was the system's third deal and its vindication: four million shares sold at $18 each, raising $72 million, and the shares more than tripled on their first day to close at $63.38. Wired reported that Hambrecht counted down from the highest bidders to set the price.

The first two OpenIPO deals had been dismissed as flops by Wall Street; the Los Angeles Times noted this was the first quality company through the auction. The mechanism's point was fairness and price discovery: all shares sell at the same clearing price rather than a banker's guess.

Let the market price the IPO; auction to everyone

An auction makes price discovery transparent instead of negotiated in private.

Every winning bidder pays the same clearing price, so no one gets a secretly better deal.

Individual investors get a real seat at the table, which was the pitch.

The company sees demand directly instead of trusting underwriter allocation.

When gatekeepers allocate a scarce good by discretion, an auction replaces their judgment with a transparent rule, and the rule is what small participants trust.

Hambrecht completed 19 auctioned IPOs in the US between 1999 and 2007, per the Degeorge-Derrien-Womack study of the deals. The mechanism never displaced book-building, but it proved an auction could price and sell a hot IPO fairly to the public and became the reference point for later attempts to democratize IPO access.