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... and yet it will be valued as one. At this point it doesn't matter if anything really is tech or not. Rich people just want to park their money away from ban

... and yet it will be valued as one. At this point it doesn't matter if anything really is tech or not. Rich people just want to park their money away from banks. (As an aside, i think WeWork’s S1 has turned to a remarkable feat of marketing, making buzz around the company in cycles who are likely to be their customers)

jbarberu 7y ago
To me it seems even stockpiling coal might be a better use of that money...
adamc 7y ago
Rich people who buy non-tech-company stock and tech-company valuations seem likely to become less rich over time. An index fund might be a sounder investment.
- kolbe 7y ago
  When the time is right, Adam will change the company voting structure and get WeWork put into the S&P 500. If all goes well, it will be at a $500b mkt cap, and everyone in VOO and SPY will be the ones paying that price.
  - WhompingWindows 7y ago
    Incorrect, You don't just "get put into" the SP500, you need to meet the qualifications first. I doubt WeWork will reach positive earnings and a market cap of 5.3 bln anytime soon. --It must be a U.S. company. --The market cap must be $5.3 billion or more. --The public float must consist of at least 50% of outstanding shares. --It must have positive reported earnings in the most recent quarter, as well as over the four most recent quarters. --The stock must have an active market and must trade for a reasonable share price. https://www.fool.com/knowledge-center/what-is-the-sp-500.aspx https://www.fool.com/knowledge-center/what-is-the-sp-500.asp...
    - kolbe 7y ago
      > I doubt WeWork will reach positive earnings and a market cap of 5.3 bln anytime soon. No one said anything about "anytime soon" (1) They are a US company. (2) They raised at a $40bn valuation in their last funding round, so I don't know why you think a $5.3bn market cap is out of the range of possibility. (3) The float will be whatever it is. (4) WeWork is a real estate company. Real estate companies tend to make profit. The biggest issue most people have with WeWork is that their profits look small. (5) Whatever that means. They will be in an active market, but reasonable is in the eye of the beholder.
      - ericd 7y ago
        Softbank is currently making up the valuation, and by doing so, setting the value for their existing holdings. Take those valuations with a large grain of salt, it's not like a publicly traded security where you can be reasonably sure of getting around that market value if you decided to sell right now.
        kolbe 7y ago
        I suggest you look into the history of companies like TLRY and the current state of BYND.
        ericd 7y ago
        Can you summarize what you’re trying to point out with those two? Is it just that the market is bubbly and willing to support insane valuations?
        kolbe 7y ago
        Beyond Meat recently was trading in the open market at $230. They decided they wanted to sell 4% of the company in a secondary offering, and they were only able to get $160/share. Tilray had similar problems trying to monetize their high valuation. The point is that bubbly tech prices in public markets are no less fragile than bubbly ones in private markets.
tryitnow 7y ago
Bingo. Although I don't know about rich people wanting to park their money away from banks. It's more like we have a massive capital glut, there's so much capital sloshing around we don't know what do with it. So some wealthy people will buy bonds with negative yields, others will buy equity at inflated valuations like WeWork. Strange times.
- roymurdock 7y ago
  Large and continued slowdown in global productivity combined with huge amounts of liquidity/easing from the world's largest central banks. Pretty good time to have a lot of money (it's always a good time to have a lot of money), to own a business in a developing economy, to start a "tech" company to be acquired in a developed economy, to be in private equity, or to fraud/bluff your way into a lot of money in a developed economy (true productivity-increasing products/technologies are currently few and far between but globalization of technology and outsourcing is still going strong). Not a great time to be poor, a saver, a licensed professional, or worker of any sort in a developed economy (aside from working at a "tech" company).

jbarberu 7y ago

To me it seems even stockpiling coal might be a better use of that money...

adamc 7y ago

Rich people who buy non-tech-company stock and tech-company valuations seem likely to become less rich over time. An index fund might be a sounder investment.

kolbe 7y ago
When the time is right, Adam will change the company voting structure and get WeWork put into the S&P 500. If all goes well, it will be at a $500b mkt cap, and everyone in VOO and SPY will be the ones paying that price.
- WhompingWindows 7y ago
  Incorrect, You don't just "get put into" the SP500, you need to meet the qualifications first. I doubt WeWork will reach positive earnings and a market cap of 5.3 bln anytime soon. --It must be a U.S. company. --The market cap must be $5.3 billion or more. --The public float must consist of at least 50% of outstanding shares. --It must have positive reported earnings in the most recent quarter, as well as over the four most recent quarters. --The stock must have an active market and must trade for a reasonable share price. https://www.fool.com/knowledge-center/what-is-the-sp-500.aspx https://www.fool.com/knowledge-center/what-is-the-sp-500.asp...
  - kolbe 7y ago
    > I doubt WeWork will reach positive earnings and a market cap of 5.3 bln anytime soon. No one said anything about "anytime soon" (1) They are a US company. (2) They raised at a $40bn valuation in their last funding round, so I don't know why you think a $5.3bn market cap is out of the range of possibility. (3) The float will be whatever it is. (4) WeWork is a real estate company. Real estate companies tend to make profit. The biggest issue most people have with WeWork is that their profits look small. (5) Whatever that means. They will be in an active market, but reasonable is in the eye of the beholder.
    - ericd 7y ago
      Softbank is currently making up the valuation, and by doing so, setting the value for their existing holdings. Take those valuations with a large grain of salt, it's not like a publicly traded security where you can be reasonably sure of getting around that market value if you decided to sell right now.
      - kolbe 7y ago
        I suggest you look into the history of companies like TLRY and the current state of BYND.
        ericd 7y ago
        Can you summarize what you’re trying to point out with those two? Is it just that the market is bubbly and willing to support insane valuations?
        kolbe 7y ago
        Beyond Meat recently was trading in the open market at $230. They decided they wanted to sell 4% of the company in a secondary offering, and they were only able to get $160/share. Tilray had similar problems trying to monetize their high valuation. The point is that bubbly tech prices in public markets are no less fragile than bubbly ones in private markets.

tryitnow 7y ago

Bingo. Although I don't know about rich people wanting to park their money away from banks. It's more like we have a massive capital glut, there's so much capital sloshing around we don't know what do with it. So some wealthy people will buy bonds with negative yields, others will buy equity at inflated valuations like WeWork. Strange times.

roymurdock 7y ago
Large and continued slowdown in global productivity combined with huge amounts of liquidity/easing from the world's largest central banks. Pretty good time to have a lot of money (it's always a good time to have a lot of money), to own a business in a developing economy, to start a "tech" company to be acquired in a developed economy, to be in private equity, or to fraud/bluff your way into a lot of money in a developed economy (true productivity-increasing products/technologies are currently few and far between but globalization of technology and outsourcing is still going strong). Not a great time to be poor, a saver, a licensed professional, or worker of any sort in a developed economy (aside from working at a "tech" company).