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Many of these businesses are also predictably linked to the broader economy - ticketing at Eventbrite, reservations/shopping for Yelp. It would be prudent to k

Many of these businesses are also predictably linked to the broader economy - ticketing at Eventbrite, reservations/shopping for Yelp. It would be prudent to keep a cash stockpile for the inevitable cyclic downturns. Full disclosure, I worked at Eventbrite two years ago.

carlineng 6y ago
Until recently, Yelp had a giant stockpile of cash, but an activist investor successfully launched a campaign to get Yelp management to return much of that cash via buybacks [1]. By the end of 2018, Yelp had a cash balance of ~$837 million and proceeded to return almost $500 million in cash to stockholders via buybacks in 2019 [2]. Hoarding cash may seem like a good idea in hindsight, but public market investors will often raise a huge stink if you try. [1] https://sqnletters.com/content/uploads/2019/01/Yelp-A-Fresh-Perspective-SQN-Investors-01.16.2019.pdf https://sqnletters.com/content/uploads/2019/01/Yelp-A-Fresh-... [2] https://ycharts.com/companies/YELP/stock_buyback https://ycharts.com/companies/YELP/stock_buyback
- gresrun 6y ago
  GOOG[0] & AAPL[1] each have stockpiles of cash & securities in excess of $100B. If thier investors are raising a stink, their CFOs don't seem to care. Disclosure: Google employee [0]https://abc.xyz/investor/static/pdf/2020Q1_alphabet_earnings_release.pdf?cache=4690b9f https://abc.xyz/investor/static/pdf/2020Q1_alphabet_earnings... [1]https://www.apple.com/newsroom/pdfs/FY20_Q2_Consolidated_Financial_Statements.pdf https://www.apple.com/newsroom/pdfs/FY20_Q2_Consolidated_Fin...
  - deleted 6y ago
    [deleted]
  - MattGaiser 6y ago
    Yelp is a stagnating stock. As long as Apple and Google stock prices keep rising, the activist types will go bother somebody else.
  - ckdarby 6y ago
    GOOG & APPL market capital is basically 1000x larger. Activist investor shows up with $100M fund that they can throw behind Yelp giving them ~10% of the company, they'll have a major say and in some other public companies they might hold the largest share stake depending on the shareholder splits. The same investor could show up with $100M on a $1T company, have 0.01% and nobody even knows who they are and they can't really push the company to do anything. There are not that many funds that can take major voicing stakes in GOOG or APPL because of the capital it would require.
- Apocryphon 6y ago
  One wonders if that activist investor will ever receive repercussions, even just the slightest loss in credibility, for the repercussions.

carlineng 6y ago

Until recently, Yelp had a giant stockpile of cash, but an activist investor successfully launched a campaign to get Yelp management to return much of that cash via buybacks [1]. By the end of 2018, Yelp had a cash balance of ~$837 million and proceeded to return almost $500 million in cash to stockholders via buybacks in 2019 [2]. Hoarding cash may seem like a good idea in hindsight, but public market investors will often raise a huge stink if you try. [1] https://sqnletters.com/content/uploads/2019/01/Yelp-A-Fresh-Perspective-SQN-Investors-01.16.2019.pdf https://sqnletters.com/content/uploads/2019/01/Yelp-A-Fresh-... [2] https://ycharts.com/companies/YELP/stock_buyback https://ycharts.com/companies/YELP/stock_buyback

gresrun 6y ago
GOOG[0] & AAPL[1] each have stockpiles of cash & securities in excess of $100B. If thier investors are raising a stink, their CFOs don't seem to care. Disclosure: Google employee [0]https://abc.xyz/investor/static/pdf/2020Q1_alphabet_earnings_release.pdf?cache=4690b9f https://abc.xyz/investor/static/pdf/2020Q1_alphabet_earnings... [1]https://www.apple.com/newsroom/pdfs/FY20_Q2_Consolidated_Financial_Statements.pdf https://www.apple.com/newsroom/pdfs/FY20_Q2_Consolidated_Fin...
- deleted 6y ago
  [deleted]
- MattGaiser 6y ago
  Yelp is a stagnating stock. As long as Apple and Google stock prices keep rising, the activist types will go bother somebody else.
- ckdarby 6y ago
  GOOG & APPL market capital is basically 1000x larger. Activist investor shows up with $100M fund that they can throw behind Yelp giving them ~10% of the company, they'll have a major say and in some other public companies they might hold the largest share stake depending on the shareholder splits. The same investor could show up with $100M on a $1T company, have 0.01% and nobody even knows who they are and they can't really push the company to do anything. There are not that many funds that can take major voicing stakes in GOOG or APPL because of the capital it would require.
Apocryphon 6y ago
One wonders if that activist investor will ever receive repercussions, even just the slightest loss in credibility, for the repercussions.