By onlyinvesting.info
Oct 3, 2019
#Anatomy #business news #business valuation #company valuation #CORPORATE FUNDING #Domo #Entrepreneurs #EQUITY #Funding #Hot Stocks #how to value a company #Initial Public Offering #initial public offering process #Initial Public Offerings #Investors #IPO #ipo in stock market #ipo process #ipo stocks #private equity #private investors #private valuation #Public Company #Square #startups #the wall street journal #UNICORN #VALUATION #venture capital #Venture Funding #Wework #wsj
Unicorns are getting haircuts, meaning high-flying startups are seeing their valuations shrink when they go public. WSJ explains why differences in the private and public markets are bloating what these companies might actually be worth.
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Wsj content editor: this video might pull in dislikes
Wsj intern: cool bruh,I will disable the counter!
It is all cool in the hood.
IPOs are set higher so that private investors and VCs can cash out at public investor expense
Que Porra é isso
I am from brazil what Your station?
Thanks WSJ for this educational video. Worth very second. Keep making theses kind of videos
We could encourage derivative contracts on private companies. It would help with price discovery for everyone including the companies themselves; https://www.mintz.com/insights-center/viewpoints/2015-09-beware-use-derivatives-purchase-and-sale-private-shares
I say let the price discovery begin!
Really appreciate this videos. Thanks to the people who made this!
The book Blitzscaling talks about the logic behind why these companies like Uber and WeWork do what they do. The thought process is illogical but for some like Facebook and Amazon it has paid off, they end up jumping into other markets to generate the bulk of their revenue Advertising (FB), AWS (Amazon). The book talks about how most of the time blitzscaling will blow up in the founders face. With so many companies using this illogical logic now, it makes it harder to compete when everyone is blitzscaling and there are no barriers to entry. More content like this WSJ. This video was great.
I’m gonna have to watch this a couple of times.
They juz want a first day bounce
🤘
Very good video
It is easier to convince one Pvt. investor to buy 1% stake for $10m and get valued at $1B, than to convince thousands of market participants of that valuation.
It is just a crime that WE company did not include the rent expenditures into ipo report, when rent is just 90% of their expenses
The background moves. Anybody? 4:35
Lol they took away likes
" community Based EBITEDA excluding real estate costs "… For a real estate company 😂😂. And investors still signed checks after seeing this?
how do they think of all this creative and complex process of stealing money?
Old saying ….only fools rush in. Glorified office sublet company with loads of hype. And now understating rental costs , or 70 % of their cost structure ( someone suggested 90% , let’s not forget payroll , furniture expending, marketing ).
You can run a successful co working enterprise , for as long as you own the real estate. And even then , you are still at risk of market saturation. This is a low barrier of entry type of industry.
At last there is a trend towards sanity in start up valuation. 'We' has no real sustainable competitive advantage. It's just a trendy serviced office. I see so many real start ups with sensible products getting turned down then you see a company like 'We' being given billions of dollars and you have to really wonder about the sanity of some VCs.
short them fukc
I always thought it was called "preferred stock", not "preference stock". Great video!
It’s a scam.
Don't forget kids: $100 for 1% gives your company a $10k valuation, because your uncle likes you, not because your startup is actually worth that much. Private investors are like your uncle…always setting valuations, just because.
I wish startups could just get back to basics: sustainable practices, sustainable profits, growth is not forever. I see so many people that might say, "imagine I owned 10% of a billion dollar company ($100M)". If you sell your position, you can only do it once. Imagine creating a business that makes you $100M yearly, so you can get $100M several times over. Point is, profits are actually really attractive. Growth can be quite the vanity metric, as most high-growth startups tend to be chronic money-losing businesses
Finance101
Really informative video. Besides this guys voice, super annoying. Many finance specialists agree, there’s no place like the market for evaluating performance and potential. Many VC’s and PE firms can get gassed up with a startups idea but then realize it’s not true value too late.
This is nothing but a SCAM.
Not deducting Rent Expense from EBITDA is actually contravention of accounting standards as it does not show a true and fair view of the financial performance of the company which is the soul of accounting standards…
Rent is the most significant Expense item of WeWork business model.
Why nobody is warning about tech start up bubbles.
We was under valued by a factor of 3.1415 times.
I take WSJ as serious as I do the thumbnail for this video
Softbank is too greedy.
Wall Street you can’t keep serving the same pump and dump lattes we ain’t hypebeasts of the controlled Information Age but saviour beings of the democratised internet age! You gut the meat 🥩 🍖 and give us bone 🦴 well guess what we ain’t buying your corpses, let them rot 💯
Buying and selling stocks is for suckers. You're competing against computer algorithms. Buying and holding low risk, dividend earning stocks and reinvesting the dividends is the way to go for the average Joe. I like residential heavy REITS and utilities. There will always be poor people who need an apartment. Utilities are almost always monopolies and people need power.
Wouldn't it be helpful to value preference stocks equal to common stocks, which will take care of the bloated value and give a real idea of the company's worth.
ARAMCO has unimaginable wealth as it sits over oceans of oil lies beneath as per God's will
Hi, at around 3:00, you said that preference shares and common stock are valued the same. Why does this mean that common stock is over valued but not that pref shares are undervalued? would be great to hear from someone who could explain this. thank you.
Hi, re accounting practices, if a private investor is not subject to the same accounting practices that public firms are, are, and if yes why, public firms like banks allowed to lend money to private investors? (remember reading somewhere that a good portion of Softbank's Funds are acquired from money obtained through loans from Japanese banks)
I LAUGHED at the 1:22 mark!!! " analysts contend it carry's a BiAS to HIGHER price"!! There ARE FEW traders who DON'T understand the prices IPO's AND multitudes are ALL RETAIL MARK-UP prices — AND WORSE! A 400% mark
up on IPO'S is on the LOW side and ALSO on MOST stocks!! The different TRANCHES of A,B,C levels are ALL getting in AT ABSURDLY low prices! It IS the NORM for management to become MULTI MILLIONAIRES —-ON BAD IPO'S( just LOOK at Adam Neumann of WEWORK), he IS NOT the ANOMALY!! Wall street talks about the RISK of going public! there is NO RISK to the management!!! they ALREADY got theirs!! So WHAT, if they DIDN'T get BILLIONS– the HUNDREDS of Millions will be MORE than sufficient! the REAL RISK is to the RETAIL investor!!! Who MAKE UP the MAJORITY that ARE NOW —- DEPENDENT on the MARKETS for their retirement and EVEN their GENERAL Financial — SURVIVAL!!At 1:48 is a BIG LIE or lack of knowledge!; What REALLY happens to the SUPPOSED " constrained private investors" IS—- the NONPUBLIC AGREEMENT between the Private investors and the BROKERS HANDLING the IPO IS: 1) they make SURE they MARK
UP the PRICE( like retail stores, , but HIGHER!!) and THEN –the Broker PUMPS the IPO to the RETAIL investor — this JUST PUSHES the PRICE HIGHER — then to CAP it OFF the BROKER AND LYING PRIVATE investors— GIVE MUTUAL funds DEALS on their stocks PRICE—– IF the MUTUAL FUND HOLDS and PUTS MANY shares in a VARIETY of funds (this makes shares LOOK like they are HELD and a GOOD investment) This is JUST PART of what is CALLED" bootstrapping" in mutual funds!! To ADD insult to injury, the RETAIL investor who OWNS these FUNDS — is UNKNOWINGLY— HELPING keep the the share price UP and STABLE—- ALL so the INSIDERS(private AND – A – B- and C private investors can ALL — MAKE A KILLING! The BEST PART for the PRIVATE investors— it ALL LOOKS LEGAL and, is REALLY — but SHOULD NOT BE AT ALL-–WHY? Because–the Private A, B, C, groups ALL HAVE NO REAL RISK!!They ALL KNOW — WELL BEFORE the IPO— they ARE going to "MAKE BANK"! and the RETAIL investor is GOING to make them JUST that MUCH RICHER!!!
This TERRIBLE GAME, is played out– over and over!!
The ONLY WAY to SOLVE THIS—- AND IT WOULD SOLVE IT-
PERIOD!! —Is to MAKE the PRICE of WHAT ALL — PRIVATE A,B,C , investors AND the INVESTMENT BANKS who are ARE HANDLING the IPO( and AFTER that)—- MAKE ALL those PRE IPO PRICES—PUBLIC KNOWLEDGE–( NOT HIDDEN in the HEAPS of pages of the IPO) BUT ANNOUNCED publicly — and REPEATEDLY, JUST before AND DAILY in the FIRST MONTH of TRADING! This way EVERYONE will be ABLE to REALLY be able CONCLUDE, what IS A FAIR PRICE!!JUST OMIT THE TRUTH AND LOOK GOOD..THIS SELLS B/S
That very same Standford Business Study find out majority of these unicorns do not actually qualify for the "unicorn" valuation/status. Ponzi-scheme
love how sqaure is worth over 50 billion now
1:54 CORONA VIRUS IS THAT YOU?
wasting money in drain
Truvk
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