FACEBOOK IPO makes it hard for startups Palo Alto Issues, posted by jb, a resident of the Crescent Park neighborhood, on May 22, 2012 at 1:08 pm
This Facebook IPO disaster is indirectly a disaster for start-ups in the valley wanting to IPO soon.
It was insanely overvalued. Its profts are falling. It is going out of fashion, Zuckerberg has 56 percent control but 20 percent of shares, they have privacy issues in Europe, mobile ad problems, poor record or NO record with acquisitions - instagram showing how good they were with that, multiple users with fake IDS (I have 8) and declining revenues.
And today we here the Facebook execs let Morgan Stanley know half way through the IPO day that profits had some proglems, and only a handful of institutional investors were told and Mom and Pop retail investors were not. That is fraudulent. They should have priced it at 5 dollars a share and they would be doing very nicely thank-you with a big war chest to do something useful with.
As it was Wall Street hyped this to insane proportions. INSANE. And now we all are to suffer the consequenes. Falling off a cliff is way worse than growing slowly. The Google boys did it right. Facebook is forever besmirched.
Posted by bang, bang, plop, a resident of another community, on May 22, 2012 at 3:55 pm
I don't feel a bit sorry for all the people who bought into the hype - that's not an investment strategy, but kudos to Mark Zuckerberg for being the ultimate con guy and lifting the starting price to $38:00.
Posted by Hmmm, a resident of East Palo Alto, on May 22, 2012 at 6:08 pm
Thanks for posting this. It was quite predictable, wasn't it? Does anyone remember Pets.com? BBQ.com? Webvan?
I was w/2 different companies that were acquired & the leaders at the bigger companies - both places - got into trouble - some even went to jail. An old friend who was a VC had to stop talking to me because of his legal entanglements while I was a stockholder. The satisfaction of seeing some over-entitled former frat boy do the perp walk only lasts so long - there are always bills to pay.
Facebook could've handled this w/some class & thought, but instead, they did the greedy reach. Shame on them - they're too selfish to feel shame as they call their broker, banker, personal candlestick maker.