This is where we get one of those differences of opinion that makes markets. The idea that Slack would free us from the tyranny of email horrifies me even as it seems to please others.
If Slack can free us from the tyranny of email, it is worth at least $17bn
The problem being that Slack is a less edited form of email. As email itself is a less edited form of the physical letter.…
See MoreWe can look at the pricing of an IPO as just the single transaction. Those selling – which includes earlier investors and possibly the company itself – would like to gain the maximum price for what they’re selling. Those who continue to hold from that group would like to maximise the price over time of course, not just at that one instant of the IPO.
However, this all gets rather more complicated when we realise that the system itself isn’t so much interested in the one transaction but rather in the success of the system.…
See MoreIf you’re thinking about Uber’s IPO then there’s the one number that you want to find out. We’re going to leave the finding out of it as an exercise for the reader because we’re like that. It is, however, the one number that is important in this whole process.
For we can see that Uber’s losing money. We can also see that it’s lost a lot of money since conception. And there’s always the hope that it will make money at some point in the future.…
See MoreNot quite a philosophic, or existential, question but an important one all the same – just what is profit at a nationally owned resource company? The importance of this being that sure, Saudi Aramco is the world’s most profitable company but how much of that actually belongs to the stockholders as the stockholders in Saudi Aramco?
More, will whatever that definition is before the IPO be the same one that pertains some years after it?…
See MoreIt’s possible for people to have a monomania and then fit everything into that world view, of course it is. There’s no explanation for Marxism other than that. But it’s rare to see such mistakes – other than that Marxism of course – being taken seriously.
Here’s one of those rare examples from The Observer:
On Friday Lyft, the ridesharing company, went public on the US stock markets, soaring 21% before ending the day up a more modest 8.7%.
It’s worth reminding ourselves that a significant rise in corporate value after an initial public offering is a failure of that IPO. Yes, that’s not normally how everyone thinks of it, certainly not the newspaper finance pages. Yet it is still so. If Lyft was sold at $21 billion – sure, not the whole company but – and a day later is worth $30 billion then that’s a failure. Because, obviously enough, the people selling stock were doing so in order to gain money for having done so.…
See MoreAs we’ve pointed out before people have a very strange series of beliefs about initial public offerings, this idea that the Lyft IPO is going to make some set of people rich. This simply isn’t so, they’re already rich, that’s why they’re having the IPO. They yesterday owned something that was of value, they today still own something which is of value. That’s how this capitalism and markets thing works.
Thus this is just silly as the basis of an article:
Here’s who will get rich from the Lyft IPO
Well, no one, actually.…
See MoreThe usual reason to hire a person or company is that they’ve skills and resources unavailable within your own organisation. This is as true of hiring a janitorial services company as it is a financial expert. But we’d rather expect a janitor one to know the business end of a mop. Which leads us to ponder whether we’d ever hire Carta given this performance by their CEO.
Do note what the company claims to be able to do.…
See MoreJust a little note here concerning the upcoming IPO of Lyft, the ride sharing company. CNBC is trying to tell us that certain people are going to get rich as a result of this IPO. This is not so – the people they’re talking about are already rich. They must be, otherwise how would an IPO gain them value?
Quite, they’e in the process of selling some part of something that’s valuable, that’s what an IPO is.…
See MoreSlack will be coming to public markets this year, so we’re told, but it won’t be in the form of an initial public offering, IPO – because Slack doesn’t need the money. That is, given that Slack doesn’t need to raise new capital from the retail markets there’s no reason for them to incur the costs which would allow them to raise new capital.
So, it looks like Slack will come to market via a direct listing rather than an IPO:
Slack to bypass traditional IPO with direct listing
Workplace messaging app would follow in the footsteps of NYSE-listed Spotify
On the London market we’d refer to this as an introduction rather than a flotation.…
See More