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Facebook already went public, you weren't invited

83 点作者 dabent超过 13 年前

13 条评论

jfager超过 13 年前
Even for financial reporting, this is an egregiously awful bit of journalism.<p><i>Once upon a time it was both an honor and a privilege to go public. A company worked tirelessly for years just to get to that point and it leapt at the opportunity to do so rather than playing it cool or blowing off bankers when they first came calling.</i><p>I'm sure we all remember the dot-com era internet companies who worked tirelessly for years to get a shot at the honor and privilege of an IPO. At least, I'm assuming that he's including these companies in his false-nostalgia, given that the two factors he blames for the loss of those halcyon days were the exchanges themselves going public (NASDAQ in 2002, NYSE in 2006) and the rise of HFT (which has really only grown to be a large part of the market since 2005).<p>And isn't it terrible that a company wouldn't blindly jump at going public the instant bankers came calling?<p><i>A comparison between Facebook today, pre-IPO, and almost any other company that is actually public on an exchange yields very little in the way of major differences</i><p>Where "major differences" would have been<p>1. Billions in capital, which of course private companies never had before the early 2000s.<p>2. Thousands of investors, where of course there's no major difference between a few thousand privileged wealthy investors and tens or hundreds of thousands of regular investors and qualification for inclusion in institutional portfolios, mutual funds, and indices.<p>3. A bump in analyst coverage, because the large armies of analysts that roved Wall Street in the good ol' days would for some reason only cover public companies. Oh, and also because there are already a ton of analysts covering Facebook, even though automated trading and exchanges going public killed all the analysts, or something.
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kennystone超过 13 年前
"They decided to go for-profit and allow anti-competitive behavior and destructive (but high-paying) new "customers" to suck all the life out of each day's trading with algorithmic codes."<p>This has nothing to do with why Facebook didn't want to go public. The biggest reasons are (1) public reporting and data (2) the amount of effort would have defocused them at a critical time of growth (3) they could raise huge funds without it and (4) perverse incentives with large institutional investors, often their largest shareholders.
kristianp超过 13 年前
Bad article, but the "you weren't invited" part is correct:<p>"Consider that the very hot IPO’, such as Facebook, are purchased by the underwriters before the public has even gotten a chance to get in. Underwriters are the big banks such as Goldman Sachs, Morgan Stanley, etc., and the shares they purchase go to their best clients first. This includes hedge funds, large institutions and huge money managers, not the majority of individual investors. "<p>"After the opening day, when the stock goes public and begins trading, most average investors can go in and buy shares at the trading price. But the opening day “pop” is over, and that is where the money is at, before the general public has had a chance." (from <a href="http://finance.yahoo.com/news/facebook-ipo-etfs-180025693.html" rel="nofollow">http://finance.yahoo.com/news/facebook-ipo-etfs-180025693.ht...</a> )<p>Unlike google's IPO which was a dutch auction, if the general public wants to make good money in facebook's IPO, they're out of luck.
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peteretep超过 13 年前
&#62; And because of this woeful state of our public markets<p>Wait, what? He spends a couple of paragraphs decrying liquidity in markets, and then calls this a bad thing.
MBlume超过 13 年前
<i>But the exchanges were unhappy with being institutions solely for the benefit for their members. They decided to go for-profit and allow anti-competitive behavior and destructive (but high-paying) new "customers" to suck all the life out of each day's trading with algorithmic codes. As spreads went from fractions of a share to decimals and then decimals of decimals, the profit margin for making markets in stocks gradually disappeared as well. This led to a annihilation of the market makers and specialists as well as decimation of the brokerage houses that employed analysts to cover the stocks that they traded in.<p>The end result is that companies come public and struggle for analyst coverage, their shares are whipped about by robot traders and the whims of whatever index ETF basket they happen to be assigned to. The regulation surrounding the reporting of accurate and timely information to their public shareholders has become so onerous and expensive that they've essentially clammed up, offering only the most terse and lawyer-approved updates on their business as infrequently as they can.</i><p>I don't understand what's happening in this part, except that the author doesn't like it. Can someone explain more slowly and less angrily?
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chernevik超过 13 年前
This would be a more convincing take down of this "market era" if it named one other "resourceful and clever" company implementing this model.<p>Put another way: When was there a market where something like FB -- explosively grown, headline potential for more, profitable -- could _not_ have raised substantial private capital?
spinchange超过 13 年前
The "textbook" reason an enterprise sells shares to the public is raise more capital as it's entering a mature phase of its business. (Not saying this is why Facebook is going public, or this is why other companies do it anymore, but this is the logical reason a company goes public.)<p>In that respect, Facebook went "public" privately last year when Goldman invested at $50B valuation.<p>The broader point or context poorly laid out is that businesses don't have to go through the same amount of public hoops that they used to raise the same kind of "public" levels of capital.
nivertech超过 13 年前
The part of the article talking about stock exchanges is wrong on so many levels.
joe_the_user超过 13 年前
The point of an S-1 filing is that Facebook had to disclose certain information and was required to operate in a certain fashion. That's big regardless of how many shares were previously floating around.<p>Also, correct me if I'm wrong but I believe Facebook has only sold shares publicly on a fairly small portion of its huge valuation so in a sense you might argue that valuation hasn't tested that much.
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notatoad超过 13 年前
if you had to be invited, how is it public?
lclaude01超过 13 年前
Curious about who got in first<p>Take a look at this<p><a href="http://i.imgur.com/ad0fJ.jpg" rel="nofollow">http://i.imgur.com/ad0fJ.jpg</a>
dr_rezzy超过 13 年前
Honestly, these are quite possibly some of the most incoherent arguments I have ever seen:<p>"At least, I'm assuming that he's including these companies in his false-nostalgia..." - great assumption<p>"Where "major differences" would have been" - You seem to be reinforcing the authors point here.<p>"This has nothing to do with why Facebook didn't want to go public." - You totally missed the authors point here.<p>"He spends a couple of paragraphs decrying liquidity in markets, and then calls this a bad thing." -You might want to check the definition of decrying.
AznHisoka超过 13 年前
"Sorry if I damped your enthusiasm"<p>It's alright, I wasn't even slightly interested.<p>"You weren't invited"<p>It's alright, I woulda farted on your invitation.
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