The traditional process used by underwriters to price IPOs. Underwriters solicit and receive indications of interest from their large institutional clients. The underwriter then makes a subjective appraisal of aggregate demand by looking at the order book and speaking with large clients. The underwriter sets the price, in consultation with the issuer, at a level that balances the conflicting need to raise capital for the issuer and compensate their buy side clients for the risk of investing in companies without trading histories.