If a company has 1000 shares outstanding, and 2000$ in assets, and it sells another 1000 shares for 1$ a pop, then the owners of pre-IPO shares get diluted. Before this, they had a share of 2$ worth of assets. Now they have a share of 1.5$ worth of assets.
Or, from another point of view. If you own shares in a company, you want that company to do well. Having the company raise more money (for the same dilution) is going to help the company do well.
Or, from yet another point of view, all these new shareholders are going to be taking a share of your dividend. You'd like the company to be able to use the new assets to grow quickly so they can pay out more dividend in total.
My point is, shareholders have reason to care about more than just the share price of a company.
Or, from another point of view. If you own shares in a company, you want that company to do well. Having the company raise more money (for the same dilution) is going to help the company do well.
Or, from yet another point of view, all these new shareholders are going to be taking a share of your dividend. You'd like the company to be able to use the new assets to grow quickly so they can pay out more dividend in total.
My point is, shareholders have reason to care about more than just the share price of a company.