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Pinterest S-1
- samcampbell 8y ago"For the year ended December 31, 2018, we generated revenue of $755.9 million, as compared to $472.9 million for the same period in 2017, representing year-over-year growth of 60%. For the year ended December 31, 2018, we generated a net loss of $63.0 million and Adjusted EBITDA of $(39.0) million, as compared to a net loss of $130.0 million and Adjusted EBITDA of $(93.0) million, respectively, in the same period in 2017"
- grivescorbett 8y agoCurious how this would change if R&D was capitalized. Of course it would just make ebitda a less accurate proxy for cash flow but we’d still be looking at it very differently.
- samcampbell 8y agoR&D was $208M in 2017 and $252M in 2018, which was about 45% and 33% of revenue, respectively.
- grivescorbett 8y agoThanks on my mobile. So revenue grows at 1.5x while R&D grows at 1.2x. Having that asset on your B/S looks pretty good over a few years.
- shoo 8y agoassuming that the R&D expenses largely convert into some kind of assets. edit: is anyone able to comment how the accounting for this kind of thing usually works? e.g. if a company spent $1m on R&D, can it arbitrarily add a line item on its balance sheet for around $1m of research outputs as some flavour of intangible asset? (this is obviously not a very accurate way to account for things in cases where the R&D failed to produce anything of utility, or produced much less utility that the R&D cost) or are the assets produced by R&D (if any) meant to be fairly valued in isolation from the cost to produce them?
- grivescorbett 8y agoThis is called capitalizing. Companies are not allowed to do it with R&D under GAAP. But it gets tricky when one company can build a factory, call it capex, and spread the expense over 10 years. Whereas another builds software infra and must expense 100% immediately.
- GordonS 8y agoWow, I would love to know how they can make so much revenue and make a loss. I only know Pinterest from annoying search results where it immediately asks you to sign up for an account, and I immediately leave - does anyone have any insights into how on earth they are spending almost a billion dollars in a year?
- harryh 8y agoPinterest continuing the trend of teach companies IPOing with dual class share structures: "Following this offering, we will have two classes of common stock: Class A common stock and Class B common stock. The rights of the holders of Class A common stock and Class B common stock will be identical, except with respect to voting, conversion and transfer rights. Each share of Class A common stock will be entitled to one vote. Each share of Class B common stock will be entitled to 20 votes and will be convertible at any time into one share of Class A common stock."
- deleted 8y ago[deleted]
- docdeek 8y agoThe Indicator podcast from Planet Money covered this topic this morning. If I remember the conclusion correctly it was that these sorts of dual class stock deals were on the way out...except for tech firms.
- drewrv 8y agoThis seems like a weird structure, why would anyone ever convert Class B stock to Class A?
- harryh 8y agoThe point of the structure is to maintain insider control, so when an insider want to sell some stock they do the conversation before selling to the public markets.
- zrail 8y agoAnd it’s likely not optional. Any transfer of shares to someone who is not already a Class B holder will probably trigger a conversion. Iirc that’s how Facebook and Google’s shares are structured.
- travisjungroth 8y ago
- polote 8y agoI didn't know pinterest was a thing, I'm not sure anyone in France use it, is that only used in the US?
- colordrops 8y agoI don't know anyone in the US using Pinterest. It seems like a search engine gaming scam to me.
- allen37 8y agoNearly every woman I know has a Pinterest account...
- jchallis 8y agoVirtually all the women over 25 in my life have a Pinterest board. Among the men in my life, it is a good way to curate porn.
- sharemywin 8y agoMy wife uses it for finding recipes, bridal stuff when we were planning our wedding, home decorating ideas.
- jedberg 8y agoMy wife uses it daily. She's a crafter and also big into using her instant pot. Both groups use Pinterest as an online gathering place. I used it just yesterday to get some ideas for landscaping my yard.
- ralmeida 8y agoReasonably well-known in Brazil among crafts-interested general audience and related areas.
- freyir 8y agoI’m in the US and know it exists, but I don’t know anyone who uses it. It seems like it’s used predominantly by women to collect and share photos taken by other people (e.g. photos of clothing, makeup, fashion models, crafts, weddings, food, etc.). The fact that I don’t know anyone who uses it does not imply that Pinterest is unpopular. I just know so few women.
- sagebird 8y agoThere is something junky about Pinterest and Quora— the experience of using it while not logged in is bad. Facebook has users in a strangle hold— afraid of alienating and being out of the loop on family affairs if they leave. Can someone convince me that Pinterest is not suceptible to an overnight diaspora if another service becomes more useful or fashionable? It’s great that Pinterest is making money but how will they defend themselves? If not, perhaps Pinterest would be a good long term short?
- ceejayoz 8y agoPlenty of folks have years worth of recipes, fashion ideas, etc. saved, so you'd need a good Pinterest-to-new-service importer, which I suspect Pinterest's API (which is, in my experience, actively hostile to developers) makes quite difficult.
- Cyclone_ 8y agoSeems weird I would think if they were serving ads they would not want to potentially turn away some users.
- temp129838 8y agoI continue to be amazed that Pinterest is still a thing.
- all_usernames 8y agoWe can surmise your gender from this comment :-D
- behringer 8y agoIt's amazing what having enough money to put you on the front page of every google search can do.
- veryworried 8y agoAnyone going to pick up stock at IPO?
- sparkling 8y agoNope. But will short after 2-3 weeks.
- vbs_redlof 8y agoWait until lockup period ends for discount prices.
- foobarbazetc 8y agoSurprisingly good financials here. Hmmmm.
- iaabtpbtpnn 8y ago"We have incurred operating losses in the past, anticipate increasing our operating expenses, expect to incur operating losses in the future and may never achieve or maintain profitability." Says it all, really.
- pdovy 8y agoIf I'm reading their MAU charts correctly, they have way more MAU outside of the US than inside (82m vs 184m last quarter), not only that but international user growth is relatively strong compared to the US. That said, 94% of revenue last quarter was from the US, so they are not monetizing internationally really at all. If they can improve international monetization then there is a lot of room for revenue growth it would seem.
- hodder 8y ago"If they can improve international monetization then there is a lot of room for revenue growth it would seem." A universal truth in the social network space. Unfortunately, not even FB can really extract much value outside of North America.
- pdovy 8y agoYeah, if they can't pull that rabbit out of the hat, it looks a bit bleak. With US MAU's stalled for the last four quarters, they are faced with extracting more revenue from the same set of users - i.e., show everybody more ads and presumably water down the user experience in the process.
- dsl 8y ago> A universal truth in the social network space. In all of advertising. Non-US users remain extremely hard to monetize across the board.
- sharkweek 8y agoELI5 - are there any prevailing theories as to why this is?
- airstrike 8y agoFrom my Latin American perspective, I'd say it's due to way less disposable income in emerging markets and less of a consumerism mindset. America has the benefit of decades of intense consumerist propaganda to fend off the evil reds, while the biggest emerging markets are often very vocally against "Capitalism" (even if they would all love to own iPhones)
- OldFatCactus 8y agoI hate what Pinterest does to google image searching. Sometimes I really just want to paste an image src in an online discussion without having to drill into devtools.
- nukeop 8y agoNot just image searches, the entire website is basically unusable, especially without proper filters to block whole screen popups, unwanted login prompts, and modal windows obscuring everything. Not to mention the JS messing up the browser history so you can't go back to any page, because their scripts will fuck that up and only store the first and last page in the chain.
- seanwilson 8y agoHow does it manage to rank so well? I'm not a user of it but whenever it appears in searches it feels like endless popups and walled content that tries to make you sign up. I would have thought Google would discourage links like this.
- friedman23 8y agoI think it's pretty clear that almost everyone that uses hackernews is in a bubble and this bubble does not include people that use Pinterest.
- exolymph 8y agoYes, but I'd be shocked if a majority of people using Google Images are on Pinterest.
- seanwilson 8y agoTrue, but Google is already meant to penalise pages that have intrusive popups so what's the difference? https://webmasters.googleblog.com/2016/08/helping-users-easily-access-content-on.html https://webmasters.googleblog.com/2016/08/helping-users-easi...
- buboard 8y ago
- trimbo 8y agoIs there like an S-1 team that does graphic design for everyone's S-1 these days? Lyft's S-1 has the same designs: pages of pictures of happy people/drivers, a full page mission statement in a sans-serif font on a solid background of color, similar page with numbers on it...
- john_moscow 8y agoI am genuinely curious, how does the year-over-year growth of 60% come together with the pretty consistent "death curve" according to Google Trends [0]. Could they have deliberately lowered the revenue in 2017 through some clever accounting in order to come up with this number? As they have been around since ~2012, are there any prior financial metrics publicly available? [0] https://trends.google.com/trends/explore?date=all&geo=US&q=pinterest https://trends.google.com/trends/explore?date=all&geo=US&q=p...
- throwawaysea 8y agoThanks for linking the Trend data. I was trying to figure out a way to express this myself. Colloquially, I feel like Pinterest used to be mentioned in conversations 5+ years ago with some frequency. For example, I would have someone mention some recipe they saw there or see links to Pinterest shared on other social networks. But in the past few years, I don't know if anyone in my circles has actually mentioned it at all. This Trend data seems to reflect what I felt through my anecdotal experience. That said, this is US data if I am not mistaken, and Pinterest seems to have a lot of activity happening internationally. Other comments state they have more MAU outside the US than within.
- conductr 8y agoIf it’s US data, then your experience is my experience and it makes total sense. The trends represents search of “Pinterest” which was word of mouth driven. This was a very word of mouth driven app. Ladies in my life educated their friends, then their mothers, then their aunts, etc. They explained what it was and what “boards” are. But, it’s reached a saturation point now where everyone knows what it is. The conversation turned to wife-> her mom “did you see my nursery board? I pinned some inspo” and no explanation is needed she already had the app installed and didn’t need to go google “Pinterest”. Also, the women in my life love it for inspiration that definitely drives purchasing behavior. I can’t speak to whether Pinterest is monetizing that opportunity to its fullest but I certainly feel like it’s established itself as a place to research a future purchase which we all know is a valuable position to be in. I use my wife’s account occasionally to look up ideas for a home renovation or landscaping ideas. It helps. But I feel they’ve made some poor UX choices bordering on dark patterns. And with that, they are probably their own biggest risk. Eventually they will do something to totally alienate and piss off their user base.
- gianpaj 8y ago> As of December 31, 2018, we had 1,797 full-time employees, an increase of 32% compared to December 31, 2017. Why do you need so many people? A breakdown for each department would be interesting
- obeattie 8y ago"We currently depend on the continued services and performance of our key personnel, including Benjamin Silbermann and others. Mr. Silbermann’s employment, and the employment of our other key personnel, is at will, which means they may resign or be terminated for any reason at any time." Genuine question: is it normal for the CEO of a company in the US to have no notice period?
- austenallred 8y agoYes, very. That's boilerplate.
- leokennis 8y agoMaybe for a CEO I’d understand but being a regular employee and knowing that you could be out of a job and pay at any time, for any arbitrary reason or no reason at all, without being able to do anything about it seems like such a shaky foundation to build your life on...
- holy_city 8y agoThat's pretty standard for the United States. On the flipside, it means the employer isn't required to keep employing you no matter what. Most unions will negotiate it (this is why Police go on paid suspensions instead of being fired, it's part of their CBA), but the vast majority of us aren't members of a union. Furthermore if you're terminated without cause, you're eligible for unemployment. In practice companies don't fire people left and right, and people don't live in constant fear of being terminated if they're providing value to their employer, or their employer isn't toxic.
- maxxxxx 8y ago"people don't live in constant fear of being terminated if they're providing value to their employer," That has almost nothing to do with being laid off or not. Most layoffs kill whole departments or divisions and the contribution of the little guy matters not a single bit.
- opportune 8y agoDoes pinterest count impressions from google images as active/distinct user? Wouldn't surprise me if they did that atrocious image search seo to juice up the MAU numbers. I probably live in a bubble but nobody I know uses pinterest.
- huac 8y ago"We review the number of monthly active users (“MAUs”), which we define as a logged-in Pinterest user who visits our website or opens our mobile application at least once during the 30-day period ending on the date of measurement [...]"
- usmannk 8y ago> We define a monthly active user as a logged-in Pinterest user who visits our website or opens our mobile application at least once during the 30-day period ending on the date of measurement.
- dymk 8y agoPinterest's primary demographic is women
- deleted 8y ago[deleted]
- president 8y agoFor those who don't seem to understand what Pinterest is aside from appearing on search results in Google, it's essentially a more photo-centric version of sub-reddits. If you're not into arts, crafts, design, or curating things, you probably wouldn't really use it.
- GordonS 8y agoI've clicked on Google results several times, but every time it asks me to sign up or login before I've seen much of anything - eh... no.
- deleted 8y ago[deleted]
- h3ckr 8y agoI think they’re going to end up flat like Twitter and Snapchat in 2 years at most. Smart to IPO now though.
- baq 8y agosmart, taking money off the market when there's still money on the market. that's the fourth notable S-1 in a month or so. if smart money cashing out doesn't signal that there's real volatility ahead, I don't know what else would.
- deleted 8y ago[deleted]
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- wavesounds 8y agoIt's weird how HN has become so negative about every recent tech companies IPO. You would think this would be the one place on the internet where people would be excited and positive about this sort of thing. I don't get it, is it jealousy about missing the boat?
- adamnemecek 8y agoHow is pinterest going public going to impact my life?
- foobandit 8y agoThere is a surge of awfully unprofitable businesses with poor business outlooks that are going public with very large valuations.
- jmtulloss 8y agoThe unfortunate thing about this thread (so far) is that almost every comment is either projecting the commenter's feeling about Pinterest or a few numbers on the first page. So much pessimism without citing the source within the S-1 that we're all reading!
- lawrenceyan 8y agoWe depend in part on internet search engines, such as Bing, Google, Yahoo! and Yandex, to direct a significant amount of traffic to our service. For example, when a user types a query into a search engine, we may receive traffic and acquire new users when those search results include Pins, boards, Pinners and other features of our service that cause the user to click on the Pinterest result or create a Pinterest account. These actions increase Pinner growth due to signups of new users and increase retention and engagement of existing Pinners. Our ability to maintain and increase the number of visitors directed to our service from search engines is not within our control. Search engines, such as Google, may modify their search algorithms and policies or enforce those policies in ways that are detrimental to us, that we are not able to predict or without prior notice. When that occurs, we expect to experience declines or de-indexing in the organic search ranking of certain Pinterest search results, leading to a decrease in traffic to our service, new user signups and existing user retention and engagement. We have experienced declines in traffic and user growth as a result of these changes in the past, and anticipate fluctuations as a result of such actions in the future. For example, in the first quarter of 2018, Google de-indexed our keyword landing pages, which negatively impacted traffic and user growth in the quarters that followed. Our ability to appeal these actions is limited, and we may not be able to revise our search engine optimization (“SEO”) strategies to recover the loss in traffic or user growth resulting from such actions. Changes in policies or their enforcement may not apply in the same manner to our competitors, or our competitors’ SEO strategies may be more successful than ours. Seems like a horrible business to invest in when you're so utterly at the whim of someone else you have no control over.
- hazelnut 8y agoSo many businesses failed before which relied on SEO. This one could go really bad if Google pulls the plug.
- creato 8y agoAnd I hope Google does. I curse under my breath every time an image search comes back with Pinterest bullshit. Google is probably petrified of fixing problems like this because the EU will ding them for another few $billion if they do.
- nullc 8y agoPinterest is one of the worst things to happen to my search experience in the last decade. I've started wondering if they're using something like StyleGAN to general endless image variations that exist nowhere else (and have no source or context on pintrest) in order to pollute google image results.
- wetpaws 8y agoPinterest brings Facebook's walled garden to a whole new level, seriously wish them to die for good.
- Tuna-Fish 8y agoAdd -site:pinterest.com to your default search.
- dpau 8y ago-site:pinterest.* works even better
- LifeLiverTransp 8y agoIs there a goolge overlay site, that allows for auto-adding filters to the search fottages- to await the usualy stockfootage cruft for example?
- sytelus 8y agoHow does tech IPOs even with very poor outlook and no potential to become big actually go through anyway? I can't imagine myself buying stock of many recent filings but apparently tech IPOs seems to be rarely failing even though many seem to be designed purely as VC escape hatch. So who really buys all these stock?
- puranjay 8y agoPinterest is basically one Google update away from having half its traffic wiped out
- johnwheeler 8y ago3rd most relevant brand? That’s ridiculous.