7 ms·
Is it just me, or are newspaper articles surprisingly difficult to read? From what I understand: 1. Instead of a traditional IPO, Slack went public through an
by puzzledobserver 3y ago
Is it just me, or are newspaper articles surprisingly difficult to read? From what I understand:
1. Instead of a traditional IPO, Slack went public through an alternative process called a direct listing.
2. As part of its direct listing, Slack sold some million "registered" and some million "unregistered" shares.
3. What are registered and unregistered shares? I could not find an explanation on Wikipedia.
4. Fiyyaz Pirrani purchased some number of shares, but later complained that Slack had misrepresented something in its declarations before going public. He filed suit against the company.
5. SCOTUS says that because Fiyyaz Pirrani could not tell which of his shares were registered and which were unregistered, he could not prove standing(?)
6. This problem would not have arisen with an IPO (because?). On the other hand, similar doubts will arise with all future direct listings, making investors hesitant to purchase shares in the corresponding companies.
Is this an accurate assessment? What are registered and unregistered shares?
- texuf 3y agoRead Matt Levine’s newsletter today, he breaks it down better than anyone.
- deleted 3y ago[deleted]
- ThePowerOfFuet 3y agoLink?
- bradleyjg 3y agoRegistered shares are essentially shares offered for sale by the company and certain insiders. Unregistered shares are everything else. Slack was probably selling shares on behalf of non-executive shareholders for unregistered part.
- nemothekid 3y agoI first came across this in Money Stuff[1], but the gist of it is, the unregistered shares came from employees selling their own shares. The reason it would not have happened with an IPO is because the employees would have been locked up. Everything else you said is correct. Now SCOTUS is saying that Pirrani cannot sue slack because he may not have bought shares directly from Slack. [1] https://www.bloomberg.com/opinion/articles/2023-06-01/ai-bots-are-coming-to-finance#xj4y7vzkg https://www.bloomberg.com/opinion/articles/2023-06-01/ai-bot...
- puzzledobserver 3y agoThanks! From the added context: 7. Pirrani's suit relied on Section 11 of the Securities Act. This alleges that the company lied in its registration document. 8. In an IPO, all shares are covered by the registration document. In a direct listing, the current shareholders of the company just start trading their shares on the market one day. 9. Notably, a direct listing makes it unclear which shares are registered (covered by the registration document) and which are unregistered. According to SCOTUS, Pirrani can't tell, so he can't prove standing under Section 11. 10. He should have sued the company under Section 10 of the Securities Act instead. This is the same mechanism used against "mature" companies. Lawyers don't like to sue under Section 10 because of reasons. Some stuff which is still unclear to me: 1. People speak of owning n shares of a company. I always thought this was simply shorthand for something like: "I own shares #1034852, #1092647, and #2986246". 2. People sometimes own 0.25 shares of a company, but I thought that this was a convenience invented by stock brokers like Fidelity and Robinhood. 3. If each share is associated with a share number, and people only hold whole shares in principle, then isn't the provenance of that share clear? Whether it is registered or not should simply be a matter of following it back in time?
- zx8080 3y agoWhat's the problem with Section 10?
- Majromax 3y ago> What's the problem with Section 10? Per the Money Stuff article, Section 10 has a higher burden of proof. For a shareholder to win a lawsuit under section 10, they need to show that the disclosures were deliberately misleading, such that the board was trying to defraud investors. Under a section 11 lawsuit, however, they only need to show that the disclosures were materially wrong: proof of motivation isn't required in the same way.
- deleted 3y ago[deleted]
- crazygringo 3y agoNot newspaper articles in general, just this one. It's a total mess.
- jessriedel 3y agoThis one is extreme, but tons of newspaper articles are weird and confusing in the same general way.
- lolinder 3y agoI think the problem with this article is the subject doesn't lend itself well to Axios's bullet points style. Their thing is to get to the point with as little ceremony as possible, but that doesn't work very well when there is so much context needed to understand the story.
- deleted 3y ago[deleted]
- JeremyNT 3y agoWeirdly the Axios style is usually the sweet spot for me, but this one misses the mark. I think the specific problem with this is that they use the "unregistered" / "registered" jargon without actually defining it first. Just one opening bullet point in "Details" that defines unregistered/registered shares and explains that buyers can't tell which they have would have done the job IMO.
- deleted 3y ago[deleted]
- aaronbrethorst 3y agoAxios’s bullet pointed style has never worked well for me. I’ve never been able to absorb any information from any article of theirs I’ve ever looked at. Total ux abomination.
- rr808 3y agoEverything is clickbait and too long now. It used to be a good newspaper told you everything you needed to know if the heading and/or the first few paragraphs. Now you have to skim read a whole article to find the only sentence that has useful information. That is even if there is any.
- suprjami 3y agoWow, you're right! From being on the school newspaper (nerd) with a ruthless English teacher as editor, I learnt the older style you just described. Actually I learnt it by having large swathes of my text highlighted and deleted with an instruction "rewrite this". I didn't realise how bad modern news is at this until you pointed it out. It's fairly common these days for me to start reading an article but still have little idea what it's about beyond the clickbait headline when I'm a third or a quarter way through an enormous read, so I just give up and leave. I wonder when and why this changed?
- xtracto 3y agoThere are a couple og good Chrome extensions that use GPT to summarize websites. Gpt3.5 is good enough, so it's pretty cheap. Now I only need one that actually overwrites the text.
- teddyh 3y agoIncentives have changed. The old style wanted to make the reader feel informed about many issues quickly when reading through most of the newspaper, making people want to buy the next newspaper. The new style wants people to go to, and then spend as much time as possible in, every individual article, in order to maximize retention numbers for ad revenue for that article.
- amadeuspagel 3y agoIt's not just you, nor is it newspaper articles, it's that fucking website, sprinkling bullet points everywhere.
- mumblemumble 3y agoI think it's safe to conclude at this point that Axios's editorial style is a failed experiment. https://newrepublic.com/article/167733/axios-guide-writing-well-neither-smart-brief-smart-brevity-book-review https://newrepublic.com/article/167733/axios-guide-writing-w...