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For founders, employees, and investors that will make significant financial gains from the IPO.

by ptio 12y ago

lisa_henderson 12y ago
You should run away from any company where "founders, employees, and investors" regard an IPO as the finish line. Run away as fast as you can.
- redorb 12y ago
  They'd never say it was.. At minimum it's a milestone.
- lisa_henderson 12y ago
  I wonder why this was downvoted? I think the point is obvious: if you suspect that founders, employees or investors regard their company's IPO as any kind of finish line, then you should run away from that company. Here on Hacker News there have been many stories about companies doing badly once founders cash out. And we have read many stories about the negative signal that it sends. I thought this was common sense, and so I didn't see a need to post any links, but it is trivially easy to find articles on this subject: If Groupon were such a great business, why have the founders cashed out in each of the investment rounds? http://www.quora.com/If-Groupon-were-such-a-great-business-why-have-the-founders-cashed-out-in-each-of-the-investment-rounds http://www.quora.com/If-Groupon-were-such-a-great-business-w... "But even beyond the lockup, a founder selling a significant chunk of equity can send a negative signal to the market and erode confidence." http://www.rudebaguette.com/2012/05/22/going-public-its-complicated/ http://www.rudebaguette.com/2012/05/22/going-public-its-comp... "Zynga’s Mark Pincus is promising in an open letter to potential shareholders that his company will be a 'meritocracy'. Except that in his meritocracy, Pincus has created a class of stock just for himself. He’ll have 70 votes for every supershare of Zynga he owns." http://www.thedailybeast.com/articles/2011/12/14/zynga-s-ipo-gives-founder-mark-pincus-a-stock-class-all-his-own.html http://www.thedailybeast.com/articles/2011/12/14/zynga-s-ipo... Do a search on Google and you'll see a thousand articles like this, all with the same theme: when insiders sell, you should run.
  - nl 12y ago
    Google Inc. co-founders Sergey Brin and Larry Page, who still own nearly one-fifth of the Internet giant, disclosed Friday that they intend to significantly reduce their stake by selling roughly $5.5 billion worth of stock over five years.[1] That's from 2010. Since then, GOOG has almost doubled in price (note that there was a stock split)[2], and they have delivered almost constant revenue and profit growth. Diversification can be a sensible strategy for founders. [1] http://www.marketwatch.com/story/google-co-founders-to-sell-55-bln-in-stock-2010-01-22 http://www.marketwatch.com/story/google-co-founders-to-sell-... [2] https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=1&chfdeh=0&chdet=1425070800000&chddm=514411&chls=IntervalBasedLine&q=NASDAQ:GOOG&ntsp=0&ei=sPsHVfGoAsj8igLJ6oCwCA https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...
  - serve_yay 12y ago
    Boy oh boy. This is taking a poorly chosen turn of phrase and really running with it. The IPO isn't the end, we get it.

For founders, employees, and investors that will make significant financial gains from the IPO.

by ptio 12y ago

For founders, employees, and investors that will make significant financial gains from the IPO.

You should run away from any company where "founders, employees, and investors" regard an IPO as the finish line. Run away as fast as you can.

redorb 12y ago
They'd never say it was.. At minimum it's a milestone.
lisa_henderson 12y ago
I wonder why this was downvoted? I think the point is obvious: if you suspect that founders, employees or investors regard their company's IPO as any kind of finish line, then you should run away from that company. Here on Hacker News there have been many stories about companies doing badly once founders cash out. And we have read many stories about the negative signal that it sends. I thought this was common sense, and so I didn't see a need to post any links, but it is trivially easy to find articles on this subject: If Groupon were such a great business, why have the founders cashed out in each of the investment rounds? http://www.quora.com/If-Groupon-were-such-a-great-business-why-have-the-founders-cashed-out-in-each-of-the-investment-rounds http://www.quora.com/If-Groupon-were-such-a-great-business-w... "But even beyond the lockup, a founder selling a significant chunk of equity can send a negative signal to the market and erode confidence." http://www.rudebaguette.com/2012/05/22/going-public-its-complicated/ http://www.rudebaguette.com/2012/05/22/going-public-its-comp... "Zynga’s Mark Pincus is promising in an open letter to potential shareholders that his company will be a 'meritocracy'. Except that in his meritocracy, Pincus has created a class of stock just for himself. He’ll have 70 votes for every supershare of Zynga he owns." http://www.thedailybeast.com/articles/2011/12/14/zynga-s-ipo-gives-founder-mark-pincus-a-stock-class-all-his-own.html http://www.thedailybeast.com/articles/2011/12/14/zynga-s-ipo... Do a search on Google and you'll see a thousand articles like this, all with the same theme: when insiders sell, you should run.
- nl 12y ago
  Google Inc. co-founders Sergey Brin and Larry Page, who still own nearly one-fifth of the Internet giant, disclosed Friday that they intend to significantly reduce their stake by selling roughly $5.5 billion worth of stock over five years.[1] That's from 2010. Since then, GOOG has almost doubled in price (note that there was a stock split)[2], and they have delivered almost constant revenue and profit growth. Diversification can be a sensible strategy for founders. [1] http://www.marketwatch.com/story/google-co-founders-to-sell-55-bln-in-stock-2010-01-22 http://www.marketwatch.com/story/google-co-founders-to-sell-... [2] https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=1&chfdeh=0&chdet=1425070800000&chddm=514411&chls=IntervalBasedLine&q=NASDAQ:GOOG&ntsp=0&ei=sPsHVfGoAsj8igLJ6oCwCA https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...
- serve_yay 12y ago
  Boy oh boy. This is taking a poorly chosen turn of phrase and really running with it. The IPO isn't the end, we get it.