Economist New Tech Bubble Cover
A few excerpts from the Economist’s current cover story, The New Tech Bubble:

“SOME time after the dotcom boom turned into a spectacular bust in 2000, bumper stickers began appearing in Silicon Valley imploring: “Please God, just one more bubble.” That wish has now been granted. Compared with the rest of America, Silicon Valley feels like a boomtown. Corporate chefs are in demand again, office rents are soaring and the pay being offered to talented folk in fashionable fields like data science is reaching Hollywood levels. And no wonder, given the prices now being put on web companies.”

“This time is indeed different, though not because the boom-and-bust cycle has miraculously disappeared. It is different because the tech bubble-in-the-making is forming largely out of sight in private markets and has a global dimension that its predecessor lacked.”

“Irrational exuberance rarely gives way to rational scepticism quickly. So some bets on start-ups now will pay off. But investors should take a great deal of care when it comes to picking firms to back: they cannot just rely on somebody else paying even more later. And they might want to put another bumper sticker on their cars: “Thanks, God. Now give me the wisdom to sell before it’s too late.”

And of course, the wisdom to understand the impact and potential outcomes on San Francisco’s real estate market if another bubble is indeed being blown.
Irrational exuberance has returned to the internet world [economist.com]

63 thoughts on “The Economist Calls Another Rather San Francisco Centric Bubble”
  1. The impact on real estate will be a function of liquidity … which will require companies like Facebook, Twitter and all their ilk to be able to access the broader capital markets and convert stock options into real money.
    Facebook and Twitter already have a pretty good secondary market in their shares, but the second-tier companies are having a harder time of it, I would guess. Having said that, the nation needs another bubble to get us out of the last slump and where better to spawn it than in San Francisco? Give this trend a couple more years — things will be looking rosy again.

  2. No $μ!+
    Twitter is worth how many billions? And we are relying on a company that’s only product is away/ status messages to revitalize an entire downtown Market of San Francisco?
    I can’t believe it’s gone on THIS long…

  3. …pay being offered to talented folk in fashionable fields like data science is reaching Hollywood levels.

    I’m guessing that “data science” is some Britishism for computer science; if not I’ve never heard of the field.
    What Jimmy wrote makes sense to me, the distinct dearth of successful IPOs is going to restrain the amount of liquidity available to dot commers to buy real estate with their windfalls. The private secondary markets dealing in shares of these companies seriously limit participation (as well they should).

  4. The new tech bubble is an interesting story for the Bay Area economy, but this certainly is not what drives SF real estate. During the much bigger dot-com bubble, SF prices got nowhere near the 2006-07 levels. It took a no-down, no-doc credit bubble for the latter, when bartenders were buying million dollar condos with nothing down. That did not happen in the dot-com years.
    Real estate demand remains light in SF despite the VC money coming into some of these tech firms (centered, again, in the south bay, not here). Show me some concrete impact on SF prices, not more “things are JUST ABOUT to take off,” and then I’ll take it seriously.

  5. All the countless hours you spend online leave traces. What counts for advertisers, companies, marketers is understanding who you are and predict what to offer you.
    There’s a sh!tload of data to analyze, a ton of noise, and not enough people properly trained to analyze it to make sense of it.

  6. My opiniion is we are in the equivalent to mid to late ’95, before Yahoo went public. When Facebook goes public for somewhere between $50-100 Billion, it will be on. I doubt the bubble will get as wild as the last one, but we’ve probably got 2-5 years of tech bubble ahead of us. I doubt that twitter will go public, as they still don’t seem to know how to get revenue, but it will sell for billions to Google, MSFT, or a similar company.
    As far as real estate prices, I think it will put some light upward pressure, like the 10% drop in interest rates over the last month or two. But I think there are still a lot of downward pressures right now that will keep any new RE Bubble from forming. Will prices keep going down? I think so, but I doubt we’ll see any collapse like in 2008. I think prices will trend slightly down, or remain generally flat at best, for the next few years, while inflation and rents increase.
    My biggest concern is that the U.S. economy’s fundamentals are pretty broken right now, so there’s a possibility of a major economic event in the next couple years. If that happens then all bets are off.

  7. Strictly anecdotal, but possibly insightful: We own a studio in SOMA/Yerba Buena. We bought mid-bubble (2005) and have kept it as a rental. We recently put it up for rent again at around $2700 (Furnished) and have had the most responses that we’ve had since we first purchased it. Bubble impact? Possibly, but I’m happy to have it because it creates a floor to the price at which we’d sell it.
    Cliff’s Notes: Tech renters and higher rents may keep prices from “bottoming” until this “New Tech Bubble” bursts.

  8. LinkedIn’s IPO on Thursday will be a good bellwether for the tech liquidity market in the next 6-18 months.

  9. Meanwhile, Cisco is barely breathing and HP says it’s going to “minimize hiring”.
    Virtually every option granted at Cisco in the last five years is underwater. About 90% of HPQ’s options in the last 5 years are underwater. In the year 2000, all of the options issued in the prior 5 years for both companies were up sharply.
    http://noir.bloomberg.com/apps/news?pid=20601087&sid=aWDS2yUmUY2c&pos=2
    HP has around 300,000 employees. Cisco has around 70,000.
    Linkedin has somewhere around 1300.

  10. With the exception of Apple and Twitter, I don’t see much of a tech bubble at this point. There are a few big time companies that do have fundamentals behind them such as Salesforce.com and Facebook.
    but outside of those and a few more, I don’t see any major spike like we saw in the .com bubble, and those two companies have fundamentals behind them.
    the current bubbles are clearly the Stock market and the Treasury market, and also certain commodity markets. All based on Fed monetization. Some of this bleeds into tech, but is not focused there.
    Tech today just isn’t like what it was back in the mid 1990s, and I don’t even think it is like what it was when Google went public either.
    I still foresee a compression in tech wages as tech matures. However, there will always be a few choice tech companies that pay nosebleed compensation packages, and currently that monster is Facebook.
    As far as RE goes it’s not enough to have massive compensation for a few individuals in tech, although that certainly doesn’t hurt local RE. We need more of a broad based increase in salary/compensation or increased access to credit and savings to really spur on RE. I still don’t see this happening overall given the continued glacial implosion of the mid 2000’s credit bubble.

  11. Like I said, we’re at 1995, before any big IPOs. I don’t really consider it to be a bubble yet, and it may not become a bubble, but I know hiring good engineers is not easy, and I think if you ask any competent engineer, they are not worried about their job, and if they haven’t received a raise, they are probably expecting one. I’m expecting a big raise in the next few weeks. I have a friend who just took a job at a big name start-up which hot him pretty large bump in compensation. Skype sold for 8.5 billion, other companies will likely start going public. There’s numerous articles about how much demand there is for tech skills.
    The dot com bubble wasn’t an instant bubble, it took years before it became an obvious bubble, but it started with good companies going public, being sold.
    I’m sure there will be a compression in salaries after this tech boom ends, but it will be years from now, and after significant growth in
    I’m certainly biased since I work in the business, but from my observation, there is a lot of demand for tech skills,there has been for at least the last 6-9 months, and that demand is growing.

  12. Regarding linked in, I believe that they are targeting a roughly $3B market cap. Assuming a 30% employee share thats about $1B spread over 1,300 people pre-tax.

  13. “Regarding linked in, I believe that they are targeting a roughly $3B market cap. Assuming a 30% employee share thats about $1B spread over 1,300 people pre-tax”
    Divided evenly that’s 770K or so each, pre tax. Hypothetically speaking if half those employees decided to buy in SF, the market would be ridiculously hot for about six months or so. Half the employees is probably way too much, and that cake will not be divided evenly of course, but one event like that could potentially really stir things up across several cross sections of SFRE. You have to take into account the limited inventory and then, from that, what’s gonna even be “desirable.”

  14. My take is simply: tech hiring is def up (and better than the past 5 yrs), and that likely means rents continue to be strong in SF.
    It (may) also lead to some strength in housing prices.

  15. @tipster, usually you’re telling us how many of those jobs are not in the Bay Area, but you conveniently left that out this time to prove your point. How many of Cisco’s and HP’s employees are located in the Bay Area?

  16. Using LinkedIn as an example, it is in Mountain View, so any impact on SF real estate is going to be pretty minimal. And tc_sf makes a good point. After about a dozen insiders, a few VCs, and a couple dozen other employees and others, there are 867,000 remaining shares owned – presumably by the rest of the employees. At the offering price, that’s about $35 million. About the same as 25 law firm partners make every year, or 5 small-ish hedge fund guys. Point being that the dot-com boom was fueled by hundreds of these IPOs followed by several-fold increases in the post-IPO stock price, and that is what spread riches among many, many individuals (and fantastic riches among a select few). And, as I noted above, even THAT did not spawn SF home price increases of anything much beyond rent-buy parity.
    I’m very happy that Web 2.1 is centered in silicon valley and, to a lesser extent, SF – good for the Bay Area economy. But those hyping it as the fuel for a run-up in SF housing prices are simply trying to egg people into paying more for homes, which is what realtors do for a living. Nothing wrong with that, but it is not like it is unbiased advice.

  17. “there are 867,000 remaining shares owned”
    Admittedly I just guessed at the 30% non-founder employee share, but your number above seems like less then 1% of the company which seems quite low.
    I would think there would be rioting if the company got a $3B IPO and the average payout was around $30k pre-tax. With a 4-year vest that’s around $7.5k/year

  18. They can riot all they want. Most of those employees were hired in a depression. They were lucky to find work.

  19. tc_sf, I’m getting the numbers from LinkedIn’s registration statement with the SEC. This IPO, like most, will result in big money to just a handful. It is only IF the stock price then multiplies many times over that decent money will flow into more hands.
    Also, stock options are not nearly as free-flowing as during the dot-com era because you now have to expense them under FASB rules whereas a decade ago you did not.

  20. It’s going to be very difficult for these companies to IPO at the valuations extrapolated from their secondary market prices. The real bellwether will be when Facebook announces an IPO and the secondary market has to acknowledge that the supply curve is about to get rearranged.
    Note that early employees (and other holders of common stock) have the most to lose if the company’s valuation drops.
    Great time to be a founder though.

  21. 30% is a very high estimate, isn’t it tc_sf? The number should be closer to 20% than 30%, I’d think. Also, don’t forget that usually the shares are locked up for 180 days after the IPO.
    If I remember correctly, LinkedIn is selling almost 5 million shares itself, and the other 3 million are being sold by shareholders, and the total number of shares outstanding will be something around 100M, and the IPO is expected to raise a little less than $150M. The co-founders and the venture capital firms have supervoting stock with 10 votes per share, such that the public stockholders will have less than 1% of the vote after the IPO.
    The draft S-1 is available:
    http://www.sec.gov/Archives/edgar/data/1271024/000119312511016022/ds1.htm
    For LinkedIn, it looks like the employee option pool is 10M or less from a quick look. There are about 15M options outstanding (vs. 88-89M shares outstanding), and about 5M of those went to the 12 listed officers and directors. The average strike price was $3.58 because they did a repricing to $2.32 at some point.
    Btw, I believe Facebook, LinkedIn, and Zynga all try to curb pre-IPO employee share sales by imposing fees, but there is still some activity, obviously.

  22. Is that LinkedIn IPO typical, seems like an exceptionally small offering… but I don’t know all that much about what is normal with an IPO.

  23. That was typical during the dot com boom. You sold almost no shares at the offering price, which was far below the actual value.
    Then you stood back and watched the press use the fact that the shares you sold at 33 cents on the dollar at the end of the day rose to a value of…a dollar(!) to make it look like this company is the greatest thing ever! Instant equity, or the equivalent. Then you let ma and pa kettle read the news and believe that the company was on a tear, because their share price tripled overnight, and the fraud is on!
    Oh, and to whom did you “sell” those few IPO shares for .33 on the dollar? Your lawyer, your accountant, all friendly parties. The public paid one hundred cents on the dollar from the get go. Six months after the share price rises and no one cares, the company will start to unload more of the shares. But because Ma and Pa Kettle are buying, the company will sell most of itself at $1.20 on the dollar.
    There is lots and lots of money in IPOs, and therefore the whole thing is a charade.
    But now look at the poor hapless employees. 10Mil shares for 1288 employees? That’s an average of 7763 shares per employee. But that gets divided over 5 years. 1552 shares per year. Most of those employees got hired in the last 2 years (the $3.68 is distorted by the fact that the founders and early investors got very low options), so assuming the share price goes up by $20 per share from when they got their shares, that’s a whopping $31,040 per employee per year.
    Hold me. I’m scared.
    Now contrast that $30K that 1288 LinkedIn employees get with what, 50,000 bay area Cisco employees and 75,000 bay area HP employees, 10 percent of whom got more than $31K in option money last year but won’t this year, and you begin to see that LinkedIn won’t even make a dent.

  24. “30% is a very high estimate, isn’t it tc_sf? ”
    Yes, a guess on the high side. But given the uncertainty in the post-lockup stock price and the number of linked in employees wanting to buy in SF it was mainly to give some scale to the discussion.
    “They can riot all they want. Most of those employees were hired in a depression. They were lucky to find work.”
    From a shareholder POV $7.5k/year isn’t really enough to make the employees get you the next $3B. I’d assume that many of these people could contract or make an iPhone app in their spare time to net at least that much.

  25. 50k bay area cisco employees? seems too high, same with the HP number. BTW, though Cisco is hurting lately, ‘on last breath’, they are not – not with $10B in rev last quarter (actual increase).
    If you’re going to pick those two, then why not then also pick Apple and Oracle? Plus, I think we’re talking SF (vs. SV), and I’d easily argue you have more Oracle/Apple employees in SF than Cisco/HP employees.
    Anyway, for SF you’ve def got growth in tech. What I’m not so sure about is if the growth in tech in SF has offset the big decline in high-paying Finance jobs in SF the past 5-7 yrs.

  26. If you’re going to pick those two, then why not then also pick Apple and Oracle?
    Um. OK.
    “Stock option grants are small and infrequent while Larry and his cronies give themselves millions every year.” – Oracle Director (Redwood City, CA)
    “NO pay raises. No advancement opportunities. Too many management levels; almost no real communication from upper management. Executives get high pay and stock options; workers get nothing. Stock purchase plan for employees is a joke.” – Oracle Systems Engineer (Location n/a)
    “Company does not reward company loyalty. Employees promoted from within are usually paid 30-40% below external hires. – Oracle Sales Representative” (Dublin, Ireland)
    http://www.glassdoor.com/blog/oracle-shareholders-complain-ellisons-salary/

  27. Wai Yip Tung and lol, thanks for enlightening me. I had an inkling about this, but didn’t know that was the name attached to this emerging field.
    Frankly (and I realize this complaint doesn’t have much to do with analyzing clickstream and other similar types of data per se), what Facebook does to make money is more than a little creepy. And I’m not talking about simply selling ads, either.

  28. Trulia are also eyeing an IPO. Individually these smallish offerings will have no siginificant impact but collectively they may add up to an indirect uptick in real estate activity.

  29. @tipster, still, those having ORCL stock have seen a nice ride. No idea what options are like but if over 7 yrs one has accumulated 7 to 10k of stock through grants or purchase program, you’re looking at a down-payment of some sort right there. On that glassdoor site, I also saw plenty of ref’s to good pay if you are in sales.
    If AAPL, then maybe you’re looking at the whole house being paid.
    Closer to SF, don’t forget SF.com (http://money.cnn.com/galleries/2011/pf/jobs/1101/gallery.best_companies_top_paying.fortune/index.html)

  30. How was their profit margin so crappy for Q1? They have decent revenue, but don’t seem to make much profit.
    Btw, $10B is more than 200 times their EBITDA for last year of $48M. Even if they increase EBITDA by 46% (as they did Q1 2010 to Q1 2011), that’s still more than 140x.
    The Demand Media stockholders must be pissed with their stock price at 14 and change. They are below the IPO price of $17, although they still have a couple months left in the 180 day lockup period.

  31. ^I agree that the current price is a bit frothy, but Demand Media doesn’t have the growing network effects of LinkedIn, and LinkedIn will likely see revenue and profit accelerate substantially over the next couple years because of those effects (think something similar to Facebook’s tipping point in 2009).

  32. LinkedIn will likely see revenue and profit accelerate substantially over the next couple years because of those effects
    Possibly, but their Q1 results are not promising for that premise:

    In an updated SEC filing Tuesday, LinkedIn said it turned a profit of $2.1 million on revenue of $93.9 million in the first quarter. In 2010, the company’s last full fiscal year, it earned $15 million in profit on sales of $243 million.

    It’s possible that their revenue and profits are not even throughout quarters, but their profit margin for Q1 of 2011 was incredibly low. They made $1.8M profit on $44.7M in revenues for Q1 of 2010. Their profit margin was more than twice as much last year.

  33. “Their profit margin was more than twice as much last year.”
    Actually, probably not. It’s probably slightly less than twice as much. For some reason I read the 2011 number as 99 instead of 93.9 the first time around. Still, not good.

  34. I suggest you buy LinkedIn stock right now, before you miss out!
    I also suggest you get in a time machine, go back to may 2007, and buy SF real estate before you miss out!
    And then turn the time machine back to Spring 2001 and buy Cisco before you miss out!
    Signed, Mr. Beta-short.

  35. I wasn’t suggesting that the price is warranted, just giving an explanation of why P/E for a company like LinkedIn, that has real network effects that explode over time, would be fairly hard to compare to a company like Demand Media, which should see more predictable, slow growth.
    There’s always the chance that LinkedIn’s network effects never reach the uber-profitable level, and the whole company flames out. That scenario is also very unlikely with Demand Media, so it’s more of a no-through-the-clouds, but also no-bottom-falling-out play.

  36. Woo hoo, I bought 10,000 shares of linked in today at 122.70! This baby is going straight to the moon!
    I wonder how much money I’ve made so far? What do you guys think, should I tell my realtor to look only on Broadway Street or should I be looking on Vallejo north of Divis?

  37. Just make sure it has a room big enough to store your beanie baby collection, which must be worth millions by now . . .

  38. You skip one bubble, they call you smart. You skip two bubbles, they call you a genius. You skip three bubbles, they call you the man that never was able to predict the latest craze and died a middle class renter.
    😉

  39. If you look at their top 20 list, some of them are corporations/funds and some are probably already billionaires, like those VC dudes. A lot of the high up execs will definitely do pretty well, even if the stock drops back to 45 in the next few weeks.

  40. I shudder to think at poor Mr. Blankfein dying a middle class renter. Hopefully he’s saved up enough for a BMR in the Bayview.
    “But one sizable LinkedIn investor, Goldman Sachs (GS), decided to sit out the secondary-market fun. Practically alone among big holders of the stock, Goldman decided to dump it all in Thursday’s debut, selling its entire 871,840-share stake at the IPO price of $45 a share”
    http://finance.fortune.cnn.com/2011/05/19/goldman-leaves-linkedin-party-early/

  41. Goldman wasn’t part of the syndication group either, right? I think it was Chase, BofA, Morgan Stanley, UBS, and Allen & Co.

  42. Here’s a story of someone who bought when the last big set of IPOs were happening.
    They paid $3400 per month after tax breaks for a Beacon 1/1. Then sold it for what worked out to be a $2400 per month additional loss.
    So they paid $5800 per month, every month, for six years, to live in a 1/1 at the Beacon that they probably could have rented for around $1800-2000.
    Any landlord who quoted a $3400 per month price with a $170,000 move out fee would have been laughed off the planet. But the realtors told everyone that if they didn’t buy now, someone from Google would pay even more later. Lesson learned: a few IPOs do not sustain a long term real estate market.
    http://www.redfin.com/CA/San-Francisco/260-King-St-94107/unit-609/home/12331054

  43. The funny thing is that when people here talk about the bay area dot com business no one ever mentioned LinkedIn; yet here we have a massive IPO, several billionaires, many millionaires at the company. And surely there are several other individual investors, pe firms, partners, etc. that made a killing. Plus a main-stay company that has high growth and profitable revenues that will continue to be a key employeer for a long time. And we haven’t even seen the wealth creation for FB, TW, ZG, etc…..
    Bubble, yes. But there is real value being created.

  44. “The funny thing is that when people here talk about the bay area dot com business no one ever mentioned LinkedIn;”
    Well, the bulk of the above thread is talking about Linkedin.
    “Bubble, yes. But there is real value being created.”
    The Internet obviously survived the first dot.com bubble and no one has alleged that housing built during the bubble will fade into the aether.
    What makes it a bubble is the valuations. Cisco is a main-stay, profitable company which is a key employer. But someone who paid the bubble price of $77 per share is probably not amused by the current price of $16.60 more then a decade later.

  45. How are my $122.70 LNKD shares doing? What?! LinkedIn FELL today? Crap, I already lost around $300,000 in a little over 24 hours on LinkedIn stock!
    Some bubble. There went my down payment. Remind me not to participate in the next one.
    🙂

  46. You’ll double your money by next week. And double it again the week after that.
    Remember, old-school brick-and-mortar measures like “revenue” and “profit” are no longer relevant. All that matters are Sticky Eyeballs and the First Mover Advantage and Costs of switching.

  47. No one needs to remind you to not participate in anything SFRE blogger who hates SFRE that you are.

  48. It’s no surprise that you would take the ultimate extreme high water mark price that was so fleeting it doesn’t even register on the stock chart. And no doubt it would suck if you were the sucker yesterday who paid $122.7 for a share of LKND, and for sure that person is out there. On the other hand, it’s a good thing you didn’t buy any shares on the secondary market pre-ipo like any accredited investor could have done. Or placed a market order @ opening yesterday like many did. Or placed an order in the first hour of trading where millions of shares were exchanged below even the end of day price right now. Good thing you’re not Goldman Sachs that decided to sell their entire position @ $45 before the shares hit the public market. But day trading LNKD is a bit risky right now as it always will be. The fact that the stock hasn’t collapsed it a pretty mighty testament. Not saying that it won’t collapse at some point here, but the stock is still trading well above the strike range of $45 per share. The bankers for FB are surely having a come to Jesus conversation today as they try to understand exactly how this happened. I wouldn’t be surprised if GS sold their shares just so they could say to FB, “whoh man, we didn’t see that coming!”.

  49. “It’s no surprise that you would take the ultimate extreme high water mark price that was so fleeting it doesn’t even register on the stock chart.”
    Note though that he picked this during the trading day so there was no guarantee that it would be the high water mark for the rest of yesterday and today.
    Contrast that with expressing surprise that no one ever mentions Linkedin a day after the IPO and a week after it was featured in a cover story in the Economist!

  50. Your intentions are clear. See name link.
    The economic impact of the tech boom on the Bay Area has been discussed numerous times on SS. Go ahead and use SS’s custom google search on any such company as an indicator of how frequently the company has been discussed on SS. LinkedIn has exactly 6 entries excluding this thread versus 4+ pages each for FB, TW, ZG, Sfdc, etc.. So my point is and was valid in that this was on off-the-radar tech company not frequently discussed here, which was, again, my original point. Of course we’re talking about it now.

  51. Perhaps you are less connected to the tech world then I, but Linkedin which claims over 100 million users and who’s IPO has been talked about since the SEC filing in January is in no way an “off-the radar” tech company.
    Your belief that it is illustrates exactly the difficulty that confronts the layman when attempting to profit from a bubble. To profit you need to time your entry and your exit better then the rest of the market. If you are surprised by an “off-the-radar” IPO four months after the SEC filing and a day after the IPO, then what is the chance of achieving this perfect timing?
    While extremely difficult to be better informed then the market it would appear quite easy to be substantially less informed.

  52. Some of us made quite a bit money on the IPO yesterday as a pure outside investor. 🙂 “Amused” by your twisting; and your trolling has elicited the last response from me on this thread. Have a wonderful weekend.

  53. @tc_sf: you are being overly pedantic IMO. Eddy’s point was simply that on this blog, most people haven’t been talking about LinkedIn when talking about the next generation of Bay Area technology companies going public and how that could potentially affect the SF RE market. Most people have been talking about Facebook, Zynga and maybe Twitter as these companies get more press. In fact, even Reid Hoffman, the founder of LinkedIn for you non-technies, acknowledges that LinkedIn did not get the PR of other companies he had invested in recently. I guess it was not quite as “sexy” as plethora of other hot startups.
    Anyway, I think we have the answer to the question “was there an appetite for tech offerings in the public markets?” Facebook will most certainly be the biggest IPO ever.

  54. “Eddy’s point was simply that on this blog, most people haven’t been talking about LinkedIn when talking about the next generation of Bay Area technology companies going public and how that could potentially affect the SF RE market. ”
    Well, to me that is more a reflection of SS rather then a true surprise. Especially since secondary market pricing before the IPO was available to certain people.
    To me the real news is that the current public market price is around 3x the last secondary market price I was aware of. If this holds past the lockup I’m curious to see how this effects people seeking to sell into the secondary market at other companies.

  55. ‘To me the real news is that the current public market price is around 3x the last secondary market price I was aware of. If this holds past the lockup I’m curious to see how this effects people seeking to sell into the secondary market at other companies.’
    interesting comment and agree. so maybe next time fewer owners will sell during that secondary thinking that their bigger payout is post IPO, eh? But then a) the price would go up (less supply) till eventually it would be too tempting not to sell ‘some’, and b) I’d imagine a lot of folks who sold in the secondary still might have some stock to sell post ipo (or they just were in a life moment when they really needed that cash, ie, buying a home or something).

  56. “Some of us made quite a bit money on the IPO yesterday as a pure outside investor. :)” eddy, now you know that is B.S. LNKD opened at around 89. Unless you bought in the first few minutes and sold within a 20 minute window right at the peak, nobody made that much money as an outside investor.

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