4 ms·

Two impressive things: Founder still owns more % than any investor (27.3%) and his Directors & VPs (12 people) together own 68.3% !

dangoldin 12y ago
The 68.3% includes the 27.3% but still amazingly impressive!
andrewf 12y ago
The percentages in that table (68.3% for directors and officers, and 22.0% / 5.6% / 4.9% / 13.6% for four significant investors) add up to 114.4%. I obviously don't understand what it actually represents :) Can somebody explain?
ChuckMcM 12y ago
Their April round of $100M with a valuation of $1+B so figure that post money on the IPO they will be $1.5 - $2B making 13 new multi-millionaires in the San Francisco and probably take 13 houses off the market[2]. And the roughly 6,000 people in their networks will say "Man I could have been doing that gig, only a matter of time until I find the one that makes me rich!" and the circle continues. [1] http://techcrunch.com/2014/04/28/cloud-app-monitoring-company-new-relic-raises-100m/ http://techcrunch.com/2014/04/28/cloud-app-monitoring-compan... [2] One allowed exemption for insider selling without filing with the SEC is certain types of mortgage expense. (which I think is still intact post STOCK act but I'm not sure so don't trade on that before checking with legal counsel)
- minimax 12y ago
  I actually googled around for SEC form 4 exemptions related to mortgage expenses and couldn't find anything, which kind of makes me think there is no such exemption. Are you sure you didn't just dream this up?
- viscanti 12y ago
  Those Directors/VPs/Founder were likely already pulling a decent salary (as execs in any industry do). They could likely afford an apartment in the city, so it should be a zero sum transaction for housing (12 houses might be purchased and 12 lower cost housing options - relatively - will come on the market). Housing prices in SF will be unaffected by this. The issues are much more nuanced (and mostly regulatory). This trope of "Post-IPO tech people are ruining the housing market" isn't helping anyone, and might serve to confuse some people unfamiliar with the actual housing market issues in SF.
inthewoods 12y ago
A few thoughts on this: - VCs got beat up on this deal. Sounds like he just handed them a term sheet and said take it or leave it. I don't know how you raise $200m and still control 27.3% as a founder and 68.3% as a company. That is great negotiating on his part - very, very impressive. - Only raising $100m in the public markets is smart as well - small float will mean more chance for the stock to do well (not always obviously). - Employees (below the Director/VP level) seem likely to be the odd man out here - you've got those guys owning 68.3%, VCs probably own most of the rest. Rank and file likely own very, very little. I'm wondering if that will lead to an exodus of employees. - I didn't see any mention of their churn rate in any of the documentation - did I just miss it? Lew and these guys have played the VC/public markets game about as perfectly as you can imho.
- nemo44x 12y ago
  They will likely raise much more than 100 million. That is the "default" setting for the S1. Also, if the IPO goes well expect the underwrite to green shoe some more.
- aacc1313 12y ago
  Note - the 68.3% includes the key VCs, who are executive directors. The balance is divided up among the other investors and the employees. If you think about it, the founding group/top management team can hope to retain ~30% if they have solid up rounds. Lew, I think, is the sole founder and has a chunk of that 30%. Very impressive indeed, especially given the large fund raise to date.

dangoldin 12y ago

The 68.3% includes the 27.3% but still amazingly impressive!

andrewf 12y ago

The percentages in that table (68.3% for directors and officers, and 22.0% / 5.6% / 4.9% / 13.6% for four significant investors) add up to 114.4%. I obviously don't understand what it actually represents :) Can somebody explain?

ChuckMcM 12y ago

Their April round of $100M with a valuation of $1+B so figure that post money on the IPO they will be $1.5 - $2B making 13 new multi-millionaires in the San Francisco and probably take 13 houses off the market[2]. And the roughly 6,000 people in their networks will say "Man I could have been doing that gig, only a matter of time until I find the one that makes me rich!" and the circle continues. [1] http://techcrunch.com/2014/04/28/cloud-app-monitoring-company-new-relic-raises-100m/ http://techcrunch.com/2014/04/28/cloud-app-monitoring-compan... [2] One allowed exemption for insider selling without filing with the SEC is certain types of mortgage expense. (which I think is still intact post STOCK act but I'm not sure so don't trade on that before checking with legal counsel)

minimax 12y ago
I actually googled around for SEC form 4 exemptions related to mortgage expenses and couldn't find anything, which kind of makes me think there is no such exemption. Are you sure you didn't just dream this up?
viscanti 12y ago
Those Directors/VPs/Founder were likely already pulling a decent salary (as execs in any industry do). They could likely afford an apartment in the city, so it should be a zero sum transaction for housing (12 houses might be purchased and 12 lower cost housing options - relatively - will come on the market). Housing prices in SF will be unaffected by this. The issues are much more nuanced (and mostly regulatory). This trope of "Post-IPO tech people are ruining the housing market" isn't helping anyone, and might serve to confuse some people unfamiliar with the actual housing market issues in SF.

inthewoods 12y ago

A few thoughts on this: - VCs got beat up on this deal. Sounds like he just handed them a term sheet and said take it or leave it. I don't know how you raise $200m and still control 27.3% as a founder and 68.3% as a company. That is great negotiating on his part - very, very impressive. - Only raising $100m in the public markets is smart as well - small float will mean more chance for the stock to do well (not always obviously). - Employees (below the Director/VP level) seem likely to be the odd man out here - you've got those guys owning 68.3%, VCs probably own most of the rest. Rank and file likely own very, very little. I'm wondering if that will lead to an exodus of employees. - I didn't see any mention of their churn rate in any of the documentation - did I just miss it? Lew and these guys have played the VC/public markets game about as perfectly as you can imho.

nemo44x 12y ago
They will likely raise much more than 100 million. That is the "default" setting for the S1. Also, if the IPO goes well expect the underwrite to green shoe some more.
aacc1313 12y ago
Note - the 68.3% includes the key VCs, who are executive directors. The balance is divided up among the other investors and the employees. If you think about it, the founding group/top management team can hope to retain ~30% if they have solid up rounds. Lew, I think, is the sole founder and has a chunk of that 30%. Very impressive indeed, especially given the large fund raise to date.