It's no secret that big institutional investors have a lot of advantages on Wall Street. They get the first chance to buy hot initial public offerings. They get to meet in person with companies' managements.

While Wall Street firms typically underwrite offerings in teams, the lead underwriter, or manager, of the offering has primary responsibility for selling the offering and reaps much of the fees and profit.

For decades, Wall Street has charged companies a standard fee of 7 percent to sell their shares to the public.

Alex Berenson Quotes