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Really? Doesn't this assume that investors are dumb or that they prefer blind-but-optimistic CEOs? I just heard an interview with the CEO of Carsales.com (just
by netsp 17y ago
Really? Doesn't this assume that investors are dumb or that they prefer blind-but-optimistic CEOs?
I just heard an interview with the CEO of Carsales.com (just went public). He was asked if he was worried about free classifieds doing to them what they did to print. Fair question. I'm sure that as CEO of a classifieds site he has thought about this . He said (paraphrased) "No. Sellers prefer us because we give them a good price and get the car sold." He alluded to an inherent connection between the first and second part of that sentence, that payed classifieds are inherently better at selling cars then free ones.
Does this 'demonstrate confidence' to investors? If you believe him, you believe he is blind to his biggest threat. I assume that most investors don't beleive him. What does that demonstrate?
If he was talking face-2-face with an investor and got asked that question, would they be impressed? Anyone here an investor that would say yes?
- roundsquare 17y agoWell, investors depend on what the CEO says. What he is trying to avoid is sounding optimistic and then falling short of expectations. The up then down in the stock price looks bad. However, its a good point that we should want a correct representation instead of a pessimistic one. We should seriously wonder about a CEO who drastically under predicts performance just as we would one who over predicts it.
- pyre 17y agoI think that the point wasn't divorcing CEO responses from reality. The point is that the CEO -- in this case -- is probably over-stating the gap between the Pre and the iPhone.