5 ms·

If you'd have to bet, do you think it's going to go significantly up or down within the first few days?

by tw1010 9y ago

jonknee 9y ago
Well, that all depends on what the opening trade is!
matte_black 9y ago
WAY up.
Analemma_ 9y ago
I think taking either side of this bet would be foolish. You can usually (but not always!) bet on a Day 1 bump for a normal IPO, but there's no historical data for a direct listing of this size, and Spotify might overprice it just because, hey, why not, they get more money and without underwriters the strong incentive to underprice disappears. If you're not working for a huge bank, stay away from this until it stabilizes.
- jonknee 9y ago
  > Spotify might overprice it just because, hey, why not, they get more money and without underwriters there are no clients to disappoint Spotify isn't pricing it, they aren't even selling shares. The initial pricing will come directly out of the order book whenever it lists. It's really unusual. Read the plan of distribution section: https://www.sec.gov/Archives/edgar/data/1639920/000119312518063434/d494294df1.htm#rom494294_24 https://www.sec.gov/Archives/edgar/data/1639920/000119312518...
  - Analemma_ 9y ago
    Presumably they'll still have an initial Ask price though? Unless I'm misunderstanding something.
    - BillinghamJ 9y ago
      I guess it depends on whether they're issuing new shares, or just allowing the trading of any existing shares already held by people.
    - jonknee 9y ago
      Spotify is not issuing new shares so they will not have any price to set. It's up to the "Registered Shareholders": > The Registered Shareholders may sell their ordinary shares covered hereby pursuant to brokerage transactions on the NYSE at prevailing market prices at any time after the ordinary shares are listed for trading thereon. Plus: > prior to the opening trade, there will not be a price at which underwriters initially sold ordinary shares to the public as there would be in an underwritten initial public offering As I said, this should be fun to watch!
    - prostoalex 9y ago
      Sounds like the company won't. Whoever places the first sell order on the exchange will get to determine the ask price.
      - shkkmo 9y ago
        I would guess that without an established price there will be a very large buy-sell spread to start that will eventually converge at a price as people lower their sell bids and raise their buy bids.
    - Trundle 9y ago
      If Spotify isn't selling, how would an initial ask price work? "We'll give you a share for $20" "I'll take it!" "No, we're not selling"
      - jonknee 9y ago
        From the document: > Unlike an initial public offering, the resale by the Registered Shareholders is not being underwritten by any investment bank. The Registered Shareholders may, or may not, elect to sell their ordinary shares covered by this prospectus, as and to the extent they may determine. Such sales, if any, will be made through brokerage transactions on the New York Stock Exchange (the “NYSE”) at prevailing market prices. So essentially early investors will be the ones [potentially] selling. The pricing should be highly volatile.
  - neom 9y ago
    Morgen Stanley is doing the book collection prior to open, so it's almost underwritten. It will be subscribed, either way.
    - jonknee 9y ago
      From the document... > because Morgan Stanley is not acting as an underwriter, it will not have engaged in a book building process, and as a result, it will not be able to provide input to the DMM that is based on or informed by that process
      - neom 9y ago
        You're totally right, my bad. I read it as ".. as a financial advisor to be available to consult AS the designated market maker" - thanks for pointing that out. :)
indescions_2018 9y ago
At the risk of turning into r/wallstreetbets here. My bias is to the downside. Driven by a cacophany of pundits on CNBC post-IPO with negative outlooks. "There is absolutely no money to be made in streaming music on the internet" and "apple isn't into music for the profits" and so on ad infinitum. As well as significant short interest in the options market. $SNAP is probably as nearest neighbor as any for price-action historical context. Market timing (H1 2019) may also be ill-favored generally for anything tech related if we see significant correction. But I certainly hope I'm wrong. And will be looking to add positions in Spotify, Dropbox, Uber, Lyft, Docker, Snowflake, AirBnB, SpaceX, WeWork, Stripe etc if and when they become available ;)
- all_usernames 9y ago
  Docker?

If you'd have to bet, do you think it's going to go significantly up or down within the first few days?

by tw1010 9y ago

If you'd have to bet, do you think it's going to go significantly up or down within the first few days?

jonknee 9y ago

Well, that all depends on what the opening trade is!

matte_black 9y ago

WAY up.

Analemma_ 9y ago

I think taking either side of this bet would be foolish. You can usually (but not always!) bet on a Day 1 bump for a normal IPO, but there's no historical data for a direct listing of this size, and Spotify might overprice it just because, hey, why not, they get more money and without underwriters the strong incentive to underprice disappears. If you're not working for a huge bank, stay away from this until it stabilizes.

jonknee 9y ago
> Spotify might overprice it just because, hey, why not, they get more money and without underwriters there are no clients to disappoint Spotify isn't pricing it, they aren't even selling shares. The initial pricing will come directly out of the order book whenever it lists. It's really unusual. Read the plan of distribution section: https://www.sec.gov/Archives/edgar/data/1639920/000119312518063434/d494294df1.htm#rom494294_24 https://www.sec.gov/Archives/edgar/data/1639920/000119312518...
- Analemma_ 9y ago
  Presumably they'll still have an initial Ask price though? Unless I'm misunderstanding something.
  - BillinghamJ 9y ago
    I guess it depends on whether they're issuing new shares, or just allowing the trading of any existing shares already held by people.
  - jonknee 9y ago
    Spotify is not issuing new shares so they will not have any price to set. It's up to the "Registered Shareholders": > The Registered Shareholders may sell their ordinary shares covered hereby pursuant to brokerage transactions on the NYSE at prevailing market prices at any time after the ordinary shares are listed for trading thereon. Plus: > prior to the opening trade, there will not be a price at which underwriters initially sold ordinary shares to the public as there would be in an underwritten initial public offering As I said, this should be fun to watch!
  - prostoalex 9y ago
    Sounds like the company won't. Whoever places the first sell order on the exchange will get to determine the ask price.
    - shkkmo 9y ago
      I would guess that without an established price there will be a very large buy-sell spread to start that will eventually converge at a price as people lower their sell bids and raise their buy bids.
  - Trundle 9y ago
    If Spotify isn't selling, how would an initial ask price work? "We'll give you a share for $20" "I'll take it!" "No, we're not selling"
    - jonknee 9y ago
      From the document: > Unlike an initial public offering, the resale by the Registered Shareholders is not being underwritten by any investment bank. The Registered Shareholders may, or may not, elect to sell their ordinary shares covered by this prospectus, as and to the extent they may determine. Such sales, if any, will be made through brokerage transactions on the New York Stock Exchange (the “NYSE”) at prevailing market prices. So essentially early investors will be the ones [potentially] selling. The pricing should be highly volatile.
- neom 9y ago
  Morgen Stanley is doing the book collection prior to open, so it's almost underwritten. It will be subscribed, either way.
  - jonknee 9y ago
    From the document... > because Morgan Stanley is not acting as an underwriter, it will not have engaged in a book building process, and as a result, it will not be able to provide input to the DMM that is based on or informed by that process
    - neom 9y ago
      You're totally right, my bad. I read it as ".. as a financial advisor to be available to consult AS the designated market maker" - thanks for pointing that out. :)

indescions_2018 9y ago

At the risk of turning into r/wallstreetbets here. My bias is to the downside. Driven by a cacophany of pundits on CNBC post-IPO with negative outlooks. "There is absolutely no money to be made in streaming music on the internet" and "apple isn't into music for the profits" and so on ad infinitum. As well as significant short interest in the options market. $SNAP is probably as nearest neighbor as any for price-action historical context. Market timing (H1 2019) may also be ill-favored generally for anything tech related if we see significant correction. But I certainly hope I'm wrong. And will be looking to add positions in Spotify, Dropbox, Uber, Lyft, Docker, Snowflake, AirBnB, SpaceX, WeWork, Stripe etc if and when they become available ;)

all_usernames 9y ago
Docker?