What’s The Point?

SPX below 1180 = sell and bearish. It’s that simple.

Though not local IMHO the groupon IPO was a very big deal for the local tech economy. Because they got the freaking money. It was a successful IPO–it means one can once again IPO warty non-profitable web companies. This will continue the flood of VC money into the valley and SF. I had assumed it would be 30 years before a new generation of suckers, er, retail investors would touch this kind of premie stock. Instead it was just 11 years.
GRPN’s post-IPO track has been worth watching. A huge short interest accumulated, there appears to have been a short squeeze last week including a very entertaining episode of tape-painting from 3:30-4PM Friday, and then this week the stock has cratered each day, including a nasty gap down Wednesday.
The shorts were sweated last weekend. Now the longs are stressing during Thanksgiving. Pass the popcorn.

^^^
So where you puttin your money? coffee cans.

No one really thinks its “going to get better”. Mostly it’s a debate about how bad it is, and how much worse it may get.

Over in the previous thread linked to above, ‘R’ wrote:

In case nobody was paying attention, S&P 500 closed up for the week…this post…was about the S&P dropping on Wednesday. Which it very quickly recovered from.

On the 11th, The S & P 500 was at 1,263.85 (the ‘recovery’ from the preceding Wednesday’s drop) and this week, on the 25th, it finished at 1,158.67, or 5.7% lower than the 9th and 8.3% lower than the 11th.
I only bring that up not to say that ‘R’ was wrong, but because I half expect to see a rally sometime during the first half of this week; the nominal “Black Friday” sales were up 6.6% from where they were the year before, according to ShopperTrak. But as I said in the first comment up top, the overall trend is down. We might have another blip upward, like the Wednesday ‘R’ mentioned, but I personally don’t see it lasting all that long given all the other things in the news. I’d be happy to be proven wrong.
khkjhjkhjk, I think the interview with Ray Dalio was the victim of some pretty ham-fisted editing. Hopefully it didn’t originally air this way.

Itmightbetoolate: what, pray tell, is the oh-so-obvious “fix” that politics in Washington is standing in the way of?
Politics in Washington isn’t standing in the way of “a fix”, because there isn’t one “fix” that is acceptable or even identifiable. The fact that all throughout the interview Dalio insists that he can sit down at a table with people that disagree and explain to them how “the economic machine works” convinced me that he may be a very capable hedge fund manager, but not at all that knowledgeable about how the rest of the world works. I find this kind of intellectual hubris pretty common among people working in finance.
I think the actual empirical evidence in favor of fiscal austerity, for example, at best contradicts those who advocate it. People come down in favor or against it because of their prior deeply-held ideological beliefs. John Boehner wants it because he’s in thrall to Republican lobbyist Grover Norquist, and he wants a smaller government and less expansive social safety net, not because austerity will lead to economic growth. Empirical evidence that contradicts his view of how the economy works is irrelevant. Sitting down with Ray Dalio for a one on one talk about how the “economic machine” works isn’t going to convince him if Dalio didn’t already agree with that world view.
I agree that a lot of painful debt paydown is in most of our collective future. I try to not use the term “deleveraging” like Dialo does because to me “leverage” implies that you borrowed to make an investment in the expectation of future gains. We (and here I mean the U.S. government, funded by our taxes) borrowed to finance a war of choice and tax cuts for rich people.
But hey, I guess those rich people will take all that money they have and buy large expensive houses in S.F. Let’s all watch and see how that plays out over the course of the next few years. Case-Shiller Index 300, here we come!

What an unexpected post from you tipster. For all the negativity you have about future values I think it is odd you bought all that stock in LNKD and GRPN.

…annnnd now we’re back up +3.67 percent today…
[Editor’s Note Don’t worry, we’ll have a post once the markets close.]

Tipster I can’t believe you haven’t mentioned your American Airlines stock yet.

I’ve never said “quantitative easing”, but you mention fake stocks you own all the time.

D’Oh!

What’s this? My Pandora shares are at an all time low. Groupon? All time low.
Lnkd is only 20% under my purchase price, and Zynga is off 40% from 6 weeks ago.
Someone with 100,000 Zynga options at $10 went from having $591,000 six weeks ago to having $9400. Maybe they can buy a used Buick with their stock option riches!
Fun times for the stock option crowd.

Tipster, you needed
to change perspective three times
to say that. So weak.

@tipster:
imagine that?? $1.3 Billion+ Valuation and it has Sales!
Instagram = NO Sales and $1 Billion Valuation
The dots don’t connect and in fullness of time the bubble will pop and RE valuations “up and down” from SF to SJ will fall

@lol:
yeah, and Sun Microsystems was an excellent value at 30x Sales in 2000
Instagram (AND Facebook btw)are bubbles and they will pop in the fullness of time and take down many others and thus take down RE up and down from Marin to San Jose

And Zygna, the latest in a long line of saviors of SF real estate, falls into single digits, 7 cents above its disastrous first day close.
Eddy thought it would be a monster IPO. It was: the kind of monster that eats downpayments.
You just have to laugh at the sellers in the article from 6 months ago, holding their homes for all the zynga millionaires. How out of touch they were: the founder sold shares for $14.00 before the IPO. Zynga employees were more flush 6 months ago than they are now!
The S-1 said the overwhelming majority of options were granted at $10 or more, so the employees that soldthe made a little money as it approached $16 inearly February, but that appears to be over now. If any bought houses, they’ll be closing soon, and that money will be off the table.

Yelp

I meant D5 and D9 sorry. Zynga hipsters wouldn’t be caught dead in D7.

Zynga comes out at 8/share and currently trades at 9.67. I forget if I called the IPO a “monster” or not; maybe I did; but it was based on the premise that Zynga is a real business with real revenue, etc… My best guess is they continue to grow and stabilize over time. Groupon? Who knows. Wouldn’t touch that with a ten foot pole.

There were millions of stock grants issued, all of which are still worth the full value of the stock.

Have we given up on having any factual basis for our ramblings on this site?

R is correct here. RSUs don’t have different “valuations” they are equivalent to a share of stock once vested.
I am a little surprised that tipster claims to have insider knowledge of compensation at Zynga. Usually this is pretty tightly held knowledge. Mind sharing with the rest of us or at least let us know how you got this info so we can decide for ourselves the likelihood of veracity?

You don’t understand the difference between a stock option and a stock grant. An RSU is a stock grant, they are given to employees outright. Of course, they are taxed as income. You don’t have to pay to get a grant, that is why it is called a “grant.”
A stock option gives you the right to purchase stock at a certain price. You can be underwater in an option, where the market price is less than the option strike price.

NVJ,
It’s hardly confidential information that most restricted stock awards are provided to get people to jump ship, and otherwise, people get options.
One example from Yelp’s S-1 (highlighting is mine):
As a privately-held company, we have historically used options as the principal component of our executive compensation program. Consistent with our compensation objectives, we believe this approach has allowed us to attract and retain key talent in our industry and aligned our executive team’s focus and contributions with the long-term interests of the company and our stockholders. We grant stock options with an exercise price not less than the fair market value of our common stock on the date of grant, so these options will have value to our executive officers only if the fair market value of our common stock increases after the date of grant. Typically, stock options granted to our executive officers vest over four or five years, allowing them to serve as an effective retention tool. We have also started to use, on a limited basis, restricted stock awards, in order to attract key talent. These restricted stock awards have a multi-year (generally over four years) time-based vesting condition, allowing them to serve as an effective retention tool.
RSUs are basically the right to get stock over a specified schedule. The company guarantees that at the end of the first year, you’ll get X shares of their stock, and so many shares each month thereafter for 3 to 5 more years. They differ from options in that options essentially give you the right to the difference in the share price over the strike price of the options, but RSUs have an effective strike price of zero – you get the entire price of the shares. There are also differences in taxation.
NVJ gets strike price and valuation confused: BOTH have a valuation at any given time, but only options have a strike price.
The way it is usually done is this. You try to get someone to jump from a public company competitor, like Zynga (I’ve switched companies in my example – obviously Yelp would go the other way). They tell you they would love to come, but they have 20,000 unvested options in their current publicly traded company at a price $14 per share under the current price of that company. If they leave, they are walking away from $280,000 even if the share price goes nowhere. If they take options and the new company’s share price goes nowhere, they get $0.
“No problem,” you say. “Come to Zynga, and we’ll give you 20,000 restricted stock units that will vest at the same schedule as your stock options. Our stock is trading on sharespost for $14.00, so it’s exactly the same. If our shares go nowhere, you’ll get the same $280,000”
So first, NVJ, you frankly sound like you don’t really know much about this subject – it sounds like you have a minimal grasp of the concepts and not much else. There IS a valuation of the RSUs, it just doesn’t involve subtracting a strike price. Not exactly difficult math. And I gave you the textbook example of how people generally use the valuations. Second, the Yelp language shows the S1s makes it pretty clear what these things are used for. You really don’t need confidential inside super secret info to figure this stuff out.
So in our example above, the person jumps to Zynga, and Zynga stock dives to $9.00 a share. The $280K at the other company has now been exchanged for $180K. NVJ, according to your logic, that is good for bay area real estate. The guy has $180K! But of course he traded $280K to get there.
So you’ve been arguing that it doesn’t matter, because this is just found money. But that’s wrong: the only reason they gave him those RSUs is because he had even more valuable options that he gave up.
Now all RSUs were not handed out at $14, so my example is admittedly extreme. The average appears to be around $10, so the few that they gave RSUs to have only lost about 8% on average, and by the time they vest, who knows where it will go.
But the facts remain the facts: these things are handed out in large numbers only to a few key people, and if the stock goes down more than the stock in the company they left behind, they lose. Someone who went from Apple to Zynga lost big time. Someone who went from EA to Zynga in 2011 has lost about 1/3 of what they had if they had stayed.

You aren’t understanding this at all NVJ, there isn’t any contradiction.
If I get an RSU and the share price on sharespost is $14 on that day, that’s what the valuation is on the day I decide to stay or leave my current company. If I got them years earlier and the share price on sharespost is $8, that’s what the valuation is when I make my decision to stay or leave my former company. You might get more or less than the valuation, but most people when evaluating what they are giving up and what they are getting would want to get an equivalent valuation to what they are giving up at the same time.
The current share price is about $9 and change. Thus, some got them at a valuation below the current share price and others got them at a valuation above the current share price.
Again, there is no strike price. The valuation is the share price on the day you get them because that’s what you use in your analysis to stay or go. The valuation does not affect what you are going to get: but here is the important part, it affects what you are willing to give up when you leave one company and join a new one.
The valuation lets you compare it to what you are giving up. Both valuations (the one you have at your current company and the one Zynga offers you) may fluctuate, but that is unknowable, though it may have been assumed that Zynga would go up more because it was pre-IPO, for those people who are stuck in the past and don’t understand that isn’t the case any longer with Sharespost and the like. So you typically compare the current valuation to the current value of what you are giving up, at least as a first order approximation.
If you are giving up $280K from your old company, and getting $280K from Zynga, then at least it takes what you are giving up, out of the equation as to whether you jump ship to Zynga, in spite of the fact that you may do better or worse than $280K at either place. Then you would look at which company might do better, but that’s a much more difficult analysis and subject to all sorts of factors beyond your control.
A better, more extreme, example might be the following: Lets say you have 10,000 options for a stock that is trading at $10, and your options are at $9. That means if the stock goes nowhere, you’ll get $10,000, the number of shares times the difference of the current price less the strike price of the options.
Now, Zynga comes along and offers you exactly 1 RSU to jump ship on a date the Zynga share price was $10 on sharespost, meaning you’d get $10 if it vested today, though it will actually vest much later. You would not take that deal because $10 is much less than the $10,000 you are giving up, and the price is unlikely to ever rise high enough to make the deal worthwhile.
On the other hand, if they offer you a million RSUs, you would take it instantly, because at the current price, the valuation of what you are getting is $10M, which is much greater than $10K you’d give up by walking away from options to switch jobs.
So you see, you can value RSUs before they vest just the same way that people believe they have paper wealth of $10,000 in unvested stock options. The fact that the valuation you assign might be wrong later doesn’t stop you from assigning one.
Now the company is not going to offer you either extreme amount, they are going to a) try to convince you their stock will rise faster than the stock of your current company, and then b) give you a little less than you have now at the current valuations, to make up for the fact that their stock will rise faster. There would be some tax differences I have ignored for simplicity, but it wouldn’t change the basic premise.
If they are right, you come out even or a little ahead. They would also give you options as a sweetener, and they might be worthless, but at least you’ll have the RSUs which will likely not be worthless in the remaining vesting period you have at your current company.
If however the share price drops to $9 a year later, you’ve been royally screwed. Your options are worthless and your RSUs are worth less than you valued them at $10. If your former company stock stayed the same, you lost. That’s because, in your original analysis to stay or go, you used $10 per share for RSUs as the valuation, the then current share price, but the actual current price is now $9. At the very least, you should have waited to jump ship. They would have had to give you more RSUs to make up for the lower valuation.
Thus the valuation you used in your analysis ($10) can be different from the current share price ($9), even though RSUs have a strike price of zero, typically.
The higher the difference, the more screwed you are. If the share price drops from $15 to $9, that’s pretty bad if your old company’s share price stays the same.
I’ve said all I need to say on this subject NVJ. If you are still confused, maybe you can speak to an accountant or something.

the valley is a bubble – all of the ipos – facebook, znga, etc – all of em – no way they compound w/in 10 years at current valuations.
the only value in the “valley” (i.e. San Jose to the south and SF to the North) is “old tech” – example, Intel – combination of dividends, buybacks combined w/existing valuation will reward typical investors w/in their lifetime. Even Apple is a better valuation than the “social media” stuff
“tipster” is right

Zynga: down 9.55% in one day.
Ha ha, someone with 100,000 options at 8.55 went from having $700,000 to having $3,000 in three months.
Cue the realtors who will soon tell us “Yes but that means the BMR market is ON FIRE!!”.

I didn’t expect this bubble to deflate until a while after the facebook IPO, but it’s already underway. Groupon down another 10%. Zynga down again and flirting with a new low. Pandora down again also near a new low. D*mn, usually the bubbles pop long after I call them (and I miss out on the last of the bubble upside). This time even I was too optimistic.

boy, anon1, the stocks I mentioned are down from half to 2/3 in a very short time. That is an extremely fast and hard crash. What do you call it? “buy now or be priced out forever?”

oh, OK, right. These companies have nothing to do with one another. Like comparing zynga with a natural gas supplier. Just random stock market fluctuations, I guess.

started about the middle of last year, maybe a little earlier. VC money started flowing big then, but has since slowed quite a bit.

Just maybe two weeks ago there were several articles touting SF VC. (There is an article on it on the Washington Post blog now, from Thursday.) You simply make things up, “anon.” Readers here look at the Business Times at least casually. You can’t just say whatever and not get challenged.

That’s not regional, one, (other than mentioning the leader Andreesen is indeed local) and you misrepresented the gist of the article, two, as it speaks to a “more optimistic”fundrising environment. So thanks for corroborating my point.

Your link clearly states that Andreesen’s latest fund is the largest to date by that local group. Thinking you usually post on huge boards like newspapers where people don’t bother to check whether trolls misrepresent links.

Huh? VC time has past for those. Revenue is indeed flowing into some of these. I’m not going to concede that linking groupon, yelp, pandora, and now splunk, and VC is a valid point. It’s not. Those companies are totally different and Groupon isn’t even local.

Zynga has lost about half its value in three months. Pandora is off 67% from its peak. Groupon is off about 65% from it’s recent peak. Splunk – off 6.2% in a week and a half and below its first day close two weeks ago. Yelp, off 20% from a few months ago and below its first day close. VC inflows are off 35% and VC outflows are off 19%.
That’s hardly good news for tech and Bay Area real estate.

Let’s just focus on local IPOs, shall we. Groupon might be interesting for someone investing in the stock market, but it is unlikely to impact local real estate much.
The Zynga lock up expires on 6/13, that is the one mostly likely to impact local real estate soon. It is currently trading below its IPO price of $10, mostly due to Pincus advantaging himself and his bankers by flooding the market with shares back in March when it was trading at $14+. If it stays below $10 until June this will mute the impact somewhat, but the large number of RSUs will likely still be felt on the local market. There were 2789 employees here at IPO. I am not sure how many are local but that could be a lot of home buyers.
Yelp has been doing well: it is trading about 50% above its IPO price of $15. The lockup for Yelp expires on 8/29. Yelp had 918 employees at IPO, and had 5 rounds of funding before going public. It was also an 8 year old company, so I am going to guess that more of the gain from the IPO is going to go to early investors than employees. Let’s keep an eye on this one.
Splunk is up 100% from its IPO price of $17, which itself was adjusted up from an initial pricing of $8-10. So we know employees are sitting on big gains there on both RSUs and options. There were only 418 employees, potentially muting its impact, but also meaning that there is more for each employee. It also only had three rounds of funding before going public. It’s lockup expires on 10/19.
On a purely personal note, I applied for a job at Splunk 2 years ago but did not get an interview. Oh well.
The Big Kahuna of course will be Facebook, which should file this month, unless they pissed off the SEC and have to wait until June. The first 400 employees have been able to sell shares on the secondary market for a while, but everyone else will have to wait until the lockup expires at the end of the year. Facebook has both a large number of employees (3539) and a large valuation, so it should have a big impact everywhere, but most extremely near Palo Alto.
Are there any other big local companies going public that I missed? Pandora is in East Bay and relatively small and I am running out of time on my morning commute, but I will research other companies if there is interest. WAGE and PRSS are Peninsula companies that might worth looking at.

NVJ, the IPO price is an irrelevant asking price designed to cause a first day pop. They sell those shares to friends of the company and let them soak up the first day gain.
They are set low. Very low. They can be far lower than the strike price of most of the options.
Case in point: Zynga. According to the S-1, the majority of the options for employees were issued at a strike price of more than $10. The IPO price was $10.
Thus, pointing out the difference between the current price and the IPO price is not indicative of any employee gains, because the IPO price is just a made up number to provide favorable publicity. You have to read the S-1s to get a sense what the option prices are.
Groupon has about 100 developers in Palo Alto. It’s about a third the size of the bay area presence as Splunk.

@Johnny & Tippy: OK, so we’re ignoring the more established companies (less “speculative”), their bubble hasn’t burst yet?
But the bubble has burst for all recent IPO companies liked LNKD?
They’re only up 70% this year.

@R
LNKD = Short!

I thought the bubble burst? I shorted my LNKD because Johnny said to. Now you’re telling me they’re up?

Yep, if you shorted zynga, yelp, pandora, opentable, and all the other losers, and bought lnkd a couple months ago, you’re okay! lnkd is up about 20% while the rest is down 1/3 to 2/3 (or more). Because you found the exception to the rule, there is obviously no bursting bubble here!
lnkd:tech::noe:SF

I strongly caution anyone with any money to invest to NOT pay attention to the shorting sills tipster, johnny, or the other shorting shill.

The shorts continue to do well!
znga dipped below its all-time low before closing just above it.
But the shorts need clueless cheerleaders on the other side, so keep buying anon1! Treasuries, at least, continue to gain. There’s a sure sign of confidence in the stock market.

You still have no idea what you are talking about tipster. The Zynga shares are still locked up.
Very few employees at Zynga (and most other companies) had a chance to sell shares on sharepost because later employees were given ZSUs not shares.
And most companies these days give rank and file employees RSUs, not options.

“Very few employees at Zynga (and most other companies) had a chance to sell shares on sharepost because later employees were given ZSUs not shares.”
Second Market Sellers
18% Current Employees
80.7% Ex-Employees
1.3% Investors
http://www.insideipo.com/2012/05/secondmarket-10-interesting-facts-from-q1-2012-charts/secondmarket-transactions-by-seller-type/

Splunk also never valued any of their options below their IPO price either. From their S-1:
From February 1, 2009 through January 31, 2012, the Registrant granted to its directors, employees, consultants and other service providers options to purchase an aggregate of 17,844,092 shares of common stock under the Registrant’s 2003 Equity Incentive Plan, or the 2003 Plan, at exercise prices ranging from $0.62 to $4.82 per share, for an aggregate exercise price of $41.7 million.
From February 1, 2009 through January 31, 2012, the Registrant issued and sold to its directors, employees, consultants and other service providers an aggregate of 9,962,504 shares of common stock upon the exercise of options under the 2003 Plan at exercise prices ranging from $0.025 to $2.94 per share, for an aggregate exercise price of $5.8 million.
So 26M shares with the highest strike price at $4.82. 26M * (32-4.82) = $706M from Splunk.
There are also another 2M grants but I will ignore them as a rounding error.
This is another company that potentially had employees sell shares on the secondary market but since Splunk’s valuation has shot up so much since IPO, there will be much more money available at the end of its lockup.
Watcher’s link supports my belief that not many current Zynga employees were able or willing to sell on the secondarymarket. Only 18% of shares sold there were by current employees.

Do you have any data, anon? Or are you merely offering lay + biased opinion because that is how it looks.

Nvjim,
My redfin said 265 houses and condos over $2M in the last year

yeah, I did. it’s a Pig getting fed for slaughter
Q1 2013 is my prediction
nice people, I’m sure, and nice service, but financially as well as in the grand scheme of things, it is a Pig in the same league as ZNGA and FB

yeah, you get to ride it from “up 76% for the year” to down 76% over the next year!
lol
pigs get slaughtered, man!

Either another recession is being priced into the market or the market is working with the Fed to create the conditions that will allow for some more QE before the election. I sold some of my equities last week in anticipation of the early summer downturn. I’ll probably be looking to get back in around July for a nice pre-election pop in the market.

tipster’s angle on this one will be prove correct
in the fullness of time
not sure what “SocketSite’s” agenda is w/its comment here, but it feels like cheerleading – not good if your interest is to preserve and promote your capital

Tippy must have millions of friends. He always has “a friend” that proves his negative point. It’s almost like he just makes them up.

JS: don’t get ahead of yourself… I don’t think anyone was arguing that FB is a great company, were they?

I love how people speculate and post things like they know the real story. At this point different sources are saying different things.
So we have reports of weaker demand then expected by the institutional investors followed by sources reporting that its already oversold due to institional investors buying it all up.
“Facebook’s record initial public offering is already oversubscribed, a source familiar with the share listing said,”
“institutional investors have so far indicated demand for more shares than Facebook has available, the source told Reuters.”
“One large institutional investor had put in a major order for shares on Wednesday and was calling around syndicate desks trying to acquire more, a second source familiar with the IPO’s progress told Reuters, declining to be identified because the details are not public.”
http://www.cnbc.com/id/47381565
Which version is the truth? I don’t know, guess we won’t know for sure until it starts trading on the market and instead of anonymous sources we will get to see how it actually performs.

BragBook is incrementally cranking up means to extract more cash from their members. Did you know that if you “like” a commercial entity on FB that your photo can appear on your friend’s pages endorsing their product? “Joann really loves the freedom and comfort that Stay Free Maxi Pads provides”. And then they are experimenting with ways to pay to boost your ego out on an isolated island in the south Pacific : http://www.stuff.co.nz/technology/digital-living/6904136/Facebook-running-test-for-highlighted-posts
Maybe this stuff will pay off. Or maybe it will backfire and alienate their user base.

I wonder how many home loans went to znga employees that were made against RSUs? And now they won’t have the cash to pay their mortgages? Now that would be an awesome irony if the znga IPO ended up causing a small increase in desperate sellers rather than the touted mass of cash-laden buyers!

yeah, even more amazing that dictator Editor doesn’t shut it down!
lol

I remember last summer you were going on about GOOG tanking. But once that rebounded you moved on to another target, I am sure we’ll get crickets from you if ZNGA rebounds.

Wow! They upped the price target? I’m shocked, shocked! You do realize that they do that for almost every deal, right? Increased the allocation? You mean just like Groupon? Groupon priced above its initial range and sold more shares than initially offered.
You do realize that fb was trading on sharespost for $42 per share before they pulled it for the IPO. Assume it’s worth somewhere between $45 and $50 now. So they initially price at a range of $28-32 and now they “raise” it to $34-38, and this is a surprise.
Who do you think set the initial price, genius? They did. And they set it low so they could “raise” it just before the IPO, and everybody acts all surprised. And when a $50 stock that they are going to sell for $38 is oversubscribed, everyone will act shocked again. And when it goes up on the first day, you guessed it, another surprise.
The whole idea is to provide an aura. The aura will bring in the dumb money. And dumb money overpays. So the hope is to push a $50 stock to $60 or more through some well planned “surprises”. The headlines will read very positively for them while everyone is paying attention.
They do this nearly every time. Tell me you aren’t falling for it again. That’s not to say that it won’t go up from all that dumb money. But dumb money usually doesn’t keep it up for very long.
BTW, what’s next after the IPO? Well, the IPO is a small enough number of shares that each of the underwriters will have the ability to prop it up if it starts falling and the supply will be restricted to make any fall less likely. But then, there will be a follow on offering of more shares.
And who will be the underwriters for the follow on offering? Why that will be the ones who took the most actions to prop the stock up. If they convince their clients to buy (or they buy themselves) between the IPO and the follow on offering, well that’s who gets that lucrative follow on business.
There are many billion of dollars at stake. Nothing is being left to chance here. Your link to the article is laughable, anyone could have told you that was going to happen. The stock should be trading around $50 or more per share. Go out on the street and offer $20 bills out of your bank’s ATM for $15 and then see how shocked you are at the results.
But the investors are going to hold their shares for a long time, past the secondary offering, and that’s when the prices usually start falling. Because then there are enough shares to satisfy the demand, there are usually too many shares for the underwriters to prop it up, and there is little motivation for anyone to pump it up to their investors or to buy the dips to try to keep the price high because the secondary offering is over.
That’s what the investors were talking about. Not the theatrical IPO-secondary offering period. That’s for the amateurs, some of whom will of course make money. The investors are basically required to hold. If they sell when the bankers are all frantically trying to prop up the prices through any means they can, no banker is ever going to sell them another IPO.

Why does tipster get so frustrated when he sees other people being successful? I am personally pretty happy, unless someone makes their fortune behaving illegally or unethically, as a booming economy helps everyone.

“In a Bloomberg Global Poll of 1,253 investors, analysts and traders, 79 percent said Facebook doesn’t deserve a valuation so high.”
http://mobile.bloomberg.com/news/2012-05-11/facebook-ipo-overvalued-at-96-billion-in-global-investors-poll
I’m not predicting what the amateurs do over the next few months, but my friends statements seemed pretty accurate when 79% said the same thing in a poll.

Clearly, 80% of all investors, analysts and traders think it’s overvalued and are not buying…
That’s why the IPO is oversubscribed. Must be all the little amateurs with the $18.5 Billion to invest.

***
And Facebook stock falls another 5% in yet another two week period. Can you believe it?
Someone with a million options at 39.99 went from having options worth ten million dollars four weeks ago to having options worth ten thousand dollars today.
Woohooo! Ten thousand dollars! I’m rich, I tells ya!
Posted by: tipster at February 29, 2012 10:38 PM
***
You do realize that fb was trading on sharespost for $42 per share before they pulled it for the IPO. Assume it’s worth somewhere between $45 and $50 now…The stock should be trading around $50 or more per share. Go out on the street and offer $20 bills out of your bank’s ATM for $15 and then see how shocked you are at the results.
Posted by: tipster at May 15, 2012 10:24 PM
***
So Tipster, what has changed over the last three months that changed your opinion from pointing out how FB’s valuation was sinking to under $40, to now thining that $40 is a discount? I mean you go from mocking options at $39.99 to comparing a $38 value to selling $20 for $15.

My gosh, you can all get in on FB in a few days and get rich! There is a reason Goldman Sachs calls the hordes who go for stuff like this “muppets” and it is not because the masses have great investing savvy!
Here’s a tip that will make you a lot of money. Do nothing with FB for about three months, then short it. You think all the insiders just added to the IPO day sales volume because they think a P/E ratio of 100 is a deal and FB will skyrocket from here? That’s right, the added shares aren’t being issued by the company but being dumped by big insiders. Go get ’em muppets!

That article is a meaningless anecdotal fluff piece about three or four people in Florida. And anyway, the average retail investor isn’t even going to get a chance at the FB IPO, and that’s been widely reported. So that’s a miss to Brahma, and a miss to anon. So weak.

Da Money Quote….
Buffett and Munger won’t buy Facebook
“We never buy into an offering” Buffett told CNN at Berkshire Hathaway’s annual meeting in Omaha earlier this month. “The idea that something coming out…that’s being offered with significant commissions, all kinds of publicity, the seller electing the time to sell, is going to be the best single investment that I can make in the world among thousands of choices is mathematically impossible.”

I disagree with Buffett on his quote (I must be crazy).
I think there are IPOs (not all) where you can make more money quicker than in other places.. I rarely hold an IPO for very long though. Last year I made >40% in six weeks. Awfully hard to do that elsewhere.
I do not think FB is one of those.

Even a lead balloon can stay aloft for a while if you toss it hard and high enough. And the pitcher has been winding up for quite a while.
The hype seems bizarre on this one, especially the Instagram acquisition.
I don’t doubt that there will be a lot of winners in the short term. Long term seems more puzzling.

Yeah? Well Google it then Brahma. There are plenty of articles about precisely how regular retail types won’t get a crack at the FB IPO. The fact that you aren’t following the news cycle very closely doesn’t exactly aid your “pretty confident” pure conjecture.

Of course anon1 is our boy Kenny.

I will try and pick up a few hundred shares of Facebook at the IPO price. Wish me luck!
It is a shoot the moon kind of stock, probably overvalued, but FB has all kinds of personal info that advertisers have been trying to get their hands on unsuccessfully for decades. They have a chance to do something really amazing there.

“Of course anon1 is our boy Kenny.”
yes, the linguogrammatik text analyzer and soft serve yogurt machine hasn’t collected enough data but did report that anon1 seems like fluj/realtormon/anon.ed but with a tinge of prescription barbiturate mixed in. (Uh, wasn’t I just railing against covert dossier creation recently ? 🙂
anon1 is right to complain about the personal attacks and impersonation. That is darn annoying.

FB = Pig getting fed for slaughter – it will begin being fed tomorrow in ernest for slaughter post Nov 2012 Election

Bad news: HP is going to layoff 25,000+ employees.
Good news: there will be lots of HP employees’ homes for sale for the 3500 FB employees to buy.

My understanding is that the Zynga lockups expire on Monday. Let’s see how the Zynga employees have done if that’s the case.
From 2007 to 2009, as a much smaller company, Zynga gave out options to what appears to be a couple of dozen employees. The options had a strike price of as high as $3.81 during the latter part of 2009, and essentially zero before then as the company was too small to be worth very much. The stock is trading at $6.64 as I write this, so the late 2009 employees, assuming 100,000 options, which is pretty high, make $300,000 and taxes are low, so they’ll clear just below $250K. They probably took a $100,000 hit to their salaries over that time period (that’s why tech companies issue options, they can pay lower salaries as a result), so they net about $150K.
The earliest couple of employees will clear about $500,000, and took a longer hit to their salaries, so they net about $350K after taxes. Obviously the founders and earliest few employees probably got much more.
But here’s where it gets interesting. In 2010, they switched to RSUs. RSUs give you the right to get cash, in the amount of RSUs you have times the share price at whatever time you ask the company for the cash. The company pays you that much. Typically, RSUs vest over a period. That means the company grants you so many RSUs up front, but you are only entitled to a fraction of those for each year you work for the company, *but* only after the IPO or a sale of the company. The fraction are considered vested after the IPO or sale, but you don’t have to take the pay for them until you want. You can only take the pay of the shares vested, and if you leave, you get nothing. Until the IPO or sale, your vested shares are zero.
SO RSUs are basically forced savings, plus a stock option. If you get 3000 RSUs each year when the share price is $6, they will cut your pay by $18,000, PLUS an amount due to the fact that you essentially have an option at $6. If the share price goes up to $10, you get the $4 extra dollars. If the share price stays at $6, you get your $18,000 back, so all it is is forced savings. Because they come with an implied option, RSUs have a value above the share price at the time and they’ll cut your pay accordingly. NVJ has repeatedly stated that RSUs are different from options because they are guaranteed to not be worthless, and that’s true, but they do deduct from your salary accordingly. When, as here, the value of the underlying shares has not gone up or has gone down, all you get is some or all of your own money back.
The big problem with RSUs, and one that is going to kick these employees in the teeth, is that they are taxed as of the vesting date, even if you didn’t take the money. And a lot of the RSUs vested on the IPO date at the IPO, for $10 per share.
So someone who got 3000 RSUs each year starting in 2010 took a salary hit of around $30,000. At the IPO, they were taxed at the $10 per share price, so they pay $5 in taxes. You can see how bad this is for them!
The RSUs are worth $1.64 over the taxes they’ll pay, so they net about $5000 for each year of service. But they took a salary hit of $30,000 each year, though that would have been taxable too (with a $15,000 net), so they are about $10,000 in the hole per year. The 2011 employees probably lost about the same: their RSU valuation was higher, so they got fewer RSUs, and paradoxically, that was better than getting more RSUs because of the taxes, but they lost the forced savings!
So, a couple of dozen people netted $150K, and about two or three dozen people made out even better – around $350K total. A half dozen more probably did better than that and the founders and early investors of course did phenomenally well. The later investors have lost a bundle.
The rest of the employees, hundreds and hundreds of people — all lost money! They got jobs with below average pay. Of course, the share price could still go up, but lots of shares are about to flood the market, so that seems doubtful in the near term.

-The overwhelming majority of the Zynga employees have lost money working there.
-Only a handful made anything.
-For all but the earliest employees, what was made was relatively small compared to the hype.
This is all certain. I did put some reasonable numbers on things and stated my assumptions where I made them to provide some concrete data points.
Of course the realtors are going to be unhappy with an actual analysis as compared to unsubstantiated hype. That was pretty much expected.

Yes, a thorough analysis is somewhat lengthy when you have different groups of employees and you are carefully analyzing each one. You should try it sometime.

I did start with facts. The S-1 has them and the current price of the stock is known.
Obviously there are many different employees and each one has a different situation. So I provided some calculations for some example employees in typical, though very favorable, situations. That’s not garbage in, that’s a few example situations calculated to completion.
The reality here is that you just don’t like the end result. It looks very, very bad for you so you are doing the best you can to try to attack it by stating the assumptions done for the purpose of example are “garbage” because they may or may not match any one employee’s situation.
Whether any employee matches the examples shown doesn’t change the end result. There are very few (and possibly none) millionaire rank and file employees. The overwhelming majority, hundreds and hundreds of employees, have lost money. The facts that I put forward back up that analysis. The assumptions made were for purposes of examples. My examples were very favorable and they still turned up not a very earth shattering conclusion in the best cases.
It’s a conclusion you don’t like and it doesn’t support your cause. We get it.
You lose. Too bad for you. Sorry if you don’t like it. Get used to it.

And what is your factual basis for asserting my example data is garbage?
I think we’ve both made our respective points clear. People can read my analysis and your factless retorts complaining about facts and make up their own minds

No winners in this thread. Can’t we just let the Editor keep this cleaned up and leave it alone.

2 months:
Zynga off 64%.
Yelp, off 44%.
Facebook off 33%.
Even apple off 12%.
HP, laying off tens of thousands.
Europe, our biggest trading partner, collapsing.
Founders of companies unable to get financing desperately selling their homes in a hurry at fire sale prices.
Boom times here. Boooom Times.

Tipster, your so called analysis is merely you saying things for effect on here. It’s very easy to Google what the post 2009 FB average engineer or sales director hires got for RSUs (10 to 15K), and factor in the pre-2010 stock split (5 to 1), factor in a few years of possible performance based smaller allotments over the past few years (or not), and to multiply by 19 dollars or something conservative, and to factor in the tax hit of .45 on the dollar or what have you. The windfall is around 10 times your “hey look at me I’m a never-will hater on Socketsite” 75K bogus number. You aren’t fooling anybody, ever, on here. The question again and again is why do you get to spazz out so much more than others with your wild disinformation.

Anon, the things you think you’re saying toward posts I make are never about anything other than you acting hostile. I’ve asked you before to please stop. Thanks.

“Tipster, your so called analysis is merely you saying things for effect on here.”
Ahh, but I’m the one that is just being “hostile.”
I understand, however, why you and R would be angry that your tech-housing-bubble-reinflation dreams never came to pass! LOL!

The realtors like to gush about how many RSUs were granted, but if you look at Zynga, that same thing scares the stockholders and they run for the exits at the lockup.
The Zynga RSUs are almost all worth nothing more than the cut in pay it took to get them, and most are worth much less.
It looked pretty good for Zynga, even a few months before the lockup, the stock shot up, all of the RSUs were gains to the employees and the realtors were smacking their lips, but in the end, what looks good to the realtors ends up looking bad to the investors and the net is most of the employees with RSUs lose money.
Will the same thing happen to the facebook RSUs? Who knows, but it’s looking even worse than Zynga for them right now.

“realtors like to gush about how many RSUs were granted”
Where?

So it’s gushing when it’s taking the numbers anybody can find on any number of business publications? And tacking on a stock price well off what today’s was? I think not. That’s not how one uses the word “gushing” in a sentence properly. Nor is it valid to continue to posit “what’s good for the goose is good for the gander,” and jump around willy-nilly between Zynga, Facebook, Groupon, Apple (lol, at your inclusion of Apple today!) Etc etc. But one meaning of gushing is to go on and on about something. Well, nobody tops you there Tipster. So add hypocrite to your litany of character flaws. Again, RSU = effective strike price of zero. And dispense with equivalating “salary cuts it took to get RSUs” across boards youKve never once substantiated.

The continued banter and persistence of certain posters seems to give one the idea that maybe they are using this method to influence public perception of the stock market. Maybe certain people should disclose whether or not they have any financial interests in the publicly traded stocks they are posting about “anonymously”? Why else would someone continue to post this type of information so vigorously?

“More likely one of the misinformationcrew pulled a quick little cynical name change like they usually do when they lose arguments,”
That’s some fine projection there, Lou.
Posted by: justme at March 28, 2012 10:38 PM

Anon1, the things you think you’re saying toward posts I make are never about anything other than you acting hostile. I’ve asked you before to please stop. Thanks.

What a load of utter crap, ed. Those were redundant typos from different boxes in your archaic little system, and you know it. Meanwhile they’re picking up each others’ thought trains. You’re corrupt.
[Editor’s Note: We’ll take your word for it, but you’ll have to take ours that no one else above was tripped up by our archaic little system nor was posting under multiple monikers as was incorrectly assumed and rather dramatically asserted.]

I tried to recruit a 2011 Zynga hire. He turned the opportunity down because he thinks his stock could pay off.

Yes, because apparently (according to Tipster) all companies without options/RSUs pay at $30k more a year for the same skillset.

Oh I’m not arguing AT.. Clearly Tipster is right. Companies that offer options/RSUs pay $30k less a year. It’s a well known fact to all of us who follow Socketsite. I mean, nobody has any data to back that up, but who cares about data when you “know” it to be true?

The point remains, that the guy values them at something. So limit!=sky, but value > 0.
RSUs are basically a deferred compensation element coupled with an option. If the stock is trading for $6, when they offer you 1000 RSUs, if the stock is trading for $16 when you sell, you’ll get ten more dollars. There is some risk to the deferred compensation, but there is also the potential for a reward to the option component. The earlier you are, the less risk and the greater reward, but I suspect that people value them at least as great as the current value of the stock times the number of RSUs.
Obviously different people have different tolerances for risk, and everyone will value them differently. Some people will value them higher, some lower. I never said that everyone values all RSUs at exactly $30K.
But what MOD is proving is that they value them at something. And to tell you the truth, if I were facebook, and I handed out RSUs at 6, and the next year the RSUs were worth $16, I wouldn’t give that guy any raises. Not only is he getting an automatic one from the RSUs, but he also forfeits the RSUs from the year before if he leaves. As a result, if salaries went up by $26,000, I wouldn’t give him a raise at all, because if he leaves, he forfeits $16K worth of RSUs from last year, and the RSUs he gets for this year go up by $10K. So yes, I’d hit him a second time for the value of those RSUs he got in the first year. $16K worth of RSUs this year and he’d still not leave if his salary was $26K under market, for the reasons MOD alludes to.
So obviously, people with RSUs are taking a hit to their salary.

Yes, that was the example I used in that case. Sorry if that concept is too complex for you. I put forth a sample person, assigned values to everything, and stated them for all to see. If you wanted, you could alter those assumptions and draw your own conclusions.
It doesn’t change the fact that these people are all a whole lot poorer than they were 3 months ago.
As I mentioned on a different thread, Zynga RSUs are worth 90% less than they were three months ago (the taxes are $5 and they went from $14 – netting $9, to $6, netting $1, a drop of 90%). Whether you went from $1M to $100K, or from $500K to $50K, people who take a 90% hit to their net worth don’t usually spend profligately on assets whose prices fluctuate, especially when so many signs are that the economy is turning down.

“Oh I’m not arguing AT.. Clearly Tipster is right.”
OK Dont argue At Tipster
Just Answer My Question
Two Offers
Pure Salary
Vs
Less Salery Plus $150k/year Apple Stock
How much less Salary do *You* take???

I saw one example offer from a fb-er who said they told him he’d get $150,000 in RSUs, to vest over so many years.
Based on how they are presenting that, I think it would be difficult for some engineer right out of school who is not schooled in how they work to value that at anything less than the total dollar amount divided by the number of years over which they vest.
I think in 2009, someone probably would expect that they could quite likely increase in value. So they may have very well valued them above that, and if so they would have been right, but probably not below it.
I also think that they could be used as golden handcuffs, both using the example I posted above, where they go up in value but are forfeited if you leave, or in MOD’s case, where they went down in value but someone thinks they could go back up.
And MOD, I suspect rather than reloading, you first tell the engineers that “We have a plan in place to get your RSUs back up to being worth $9 like they were.” You reload when the engineers realize there is no way that’s going to happen.

RfR, are you actually arguing that receiving RSUs from Zynga in 2007 is directly comparable to receiving AAPL stock today?
If you believe that then no wonder you think people take $30,000 less in salary.
But here in the real world, things are different.

“RfR, are you actually arguing that receiving RSUs from Zynga in 2007 is directly comparable to receiving AAPL stock today?”
No
But When they were At $10 on Secend Market They were comparable to 10$ worth of AAPL
Specially to Guys who Took the Job There
Guys like jonny who Think there a Pig arent the ones Taking the Jobs There

RfR: Could you please run spellcheck, your posts are painful to try and read.
And no, $10 of RSUs on the secondary market are not and never were worth $10 of a highly valuable very successful publicly traded company.

^^Because that is what everyone is talking about, going long on social media.
I would like to “make money”, do you have any actual advise besides shorting social media. Becuase you said the entire USA economy is a pig that is going to get slaughtered. Short everything is that the plan?

I appreciate you actually saying something in that post. I like ko as well.

unsustainable
bubble waiting to pop!

only a 10% decline and not fundamentally driven

That’s not the way that that works and either you know that and are being that way for effect, or didn’t pay attention to the ample instruction others offered. Either way you are a complete bore nowadays.

Once again that is not my name, you creepily negative childish, stalker-lite troll. But 10000 RSUs @ 5.60 would be something like 33K minus the brokerage fee. No great sum, but not 60 cents each either.

Always with the little laughs and things. As if you made salient points in any of these threads, and didn’t let unsubstantiated numbers dangle. And no, that’s not it either. But Anon1 would be fine thanks, creepy loser. (What’s the obsession with bringing down the 4th wall anyway, as you’re not an actor or a participant?) Anyway, with this you’ve reached the quota of words you’ll get out of me for a while. You can finish the other trolls’ thoughts and be rude to whomever wthout my input, I am quite sure of that. I’ve said something. I didn’t merely mock something. Try to argue with substance, once. I’ll sit back and read how it goes. Maybe I’ll deign to speak to you. Maybe not. Probably not, as I bring the worst out of you it seems.

^^^10,000 x .6 has never been 600, not in 1999, not in the first tech bubble not ever. How can we be expected to accept your high-fallutin’ economic wizardry and salary comparisons when you can’t do simple math?

Hey, at least he is consistent and no matter how many times he multiples $0.60 x 10000 he comes up with $600.

“Either way you are a complete bore nowadays.”
“I’ve said something. I didn’t merely mock something.”
Right. LOL!
R, you are confusing “vesting” with “end of lockup period.” Two different events. Taxes are based on the first, and the RSUs are vested at IPO. Think of it this way – if (like dot-com 1.0) znga stock tripled between IPO and lockup instead of halving, the employees’ tax bite would not also have tripled because it was “worth” 3X more after the lockup (the gain would have been taxable as capital gains but not as ordinary income). But it cuts the other way here. Big time.

The zynga RSU agreement is online.
Vest is at IPO. Sorry.
http://www.sec.gov/Archives/edgar/data/1439404/000119312511315435/d198836dex1026.htm

why the fascination w/ZNGA “RSUs”??
boil it down. why does anyone care??
ZNGA is a pig and is in process of being slaughtered.
whether you own RSUs or open market share, you will not see much wealth creation, if any.
if you want to create wealth via ZNGA, fascinate yourself w/shorting it

What’s amazing is how much the press loves to hype the “Zynga millionaires” just before the IPO, but never follows up.
For example, look at “the 1000 facebook millionaires”. If you track that back, a wealth management firm that had a few facebook employees as clients figured out the typical amounts of stock people were getting and identified the number at 850. The press changed that to “about 1000”. However, the 850 was 600 at the IPO and then 250 later as shares vested. So the number was really 600, but was reported as 1000.
But that was assuming the IPO price. I’m sure they could tell you exactly how many there are at todays price, but obviously that’s a much lower number and not worthy of the headlines like 1000 was.
It also was before taxes, and as you can see, taxes can take a huge bite, and sometimes the whole shebang.
Zynga probably had a couple of dozen people who really netted anything more than the price of a really nice car, in contrast to the hundreds of millionaires originally reported. By the time the lockup expires, facebook will probably have about two hundred people in similar situations, after taxes. The press will never say anything about it. 1000 will be the number that stuck.
Even if fb held its IPO price, the taxes alone would have reduced the number of millionaires to a much lower number, but that doesn’t sell newspapers, or dreams. Sorry to disappoint you. And for every fb employee who will net even $200K, there are 1000 employees at other startups taking reduced salaries who will net nothing.
It’s basically like the gold rush. The papers had reports of miners making bank here and there, but of course, what that really does is attract more miners, which helps sell pick axes, shovels, jeans and all sorts of other advertisers of the newspapers, and that helps the newspapers. The saloons did well. The vast majority of the gold rush people who chased the gold rush did not make anything. The people selling pick axes make all the money. They never make headlines, nor do they want to. They want to attract miners, not pick axe shop keepers.
So go ahead and follow the headlines of this guy or that finding a gold nugget. The reality is quite different. The benefit of the fb IPO is not the fb-ers buying houses, it’s the ability of the Realtors to terrify the non-fb-ers that they need to buy now, and pay any price to do so, “before several hundred Zynga millionaires and a thousand facebook millionaires all immediately spend every dime on a house”, which is of course, not going to happen because after taxes, at the current prices, there aren’t nearly that many.

You”ve not earned the right to summarize + realtor bash when it comes to these matters, Tipster. Here you are AGAIN pretending like FB and ZNGA are the same. Once more, numbers were used at a valuation of 19 dollars, well under your IPO number prattle, and the payout dwarfed your fake 75K nonsense. Give the “I’m going to repeat myself 11000 times” m.o. A deserved rest..

The only issue that matters is when does the asset no longer have a risk of forfeiture. A lockup is irrelevant.
At the time the RSUs vest, they transfer and its income. An ambiguous phrase in a fidelity link is kind of a weak argument to hang your hat on.
This is a much more detailed treatment (see the Q&A #3 on the second to the last page of this link):
https://content.etrade.com/etrade/customer/invest/finalrestrictedstockfaqs.pdf
I realize you guys want to hold on to this view for dear life, so I’m done discussing it with you, but anyone who reads the link above will realize that it is the risk of forfeiture that determines the date of transfer, and thus the value of what got transferred. The risk ended at the IPO. Thus, it gets valued at the IPO and you pay taxes on that value. Those RSUs really turned out to be nearly worthless.
Worthless.

@sparky-b
short it NOW! only 1 minute left!!
lol

@R
yeah, up huge! LOL

And now it’s down! ka-ching!
There is no margin call with such tiny swings.

Not that you expect immediate results, but in one day, johnny was right. Down 10 cents a share.

Eddys the Zynga Monster
Jonnys the Zynga Pig
We All Get That
How About Victory Danses every Five Bucks
Not Every 10 Cents

New low for zynga. Under $5. Wonder how long before we see the deluge of zynga employees’ homes come on to the market as they need to raise cash to pay their taxes? Unless they followed johnny’s advice to short.

Hope sparky took johnny’s advice, $1 per share drop in six days, 16% move. Where is R?

“How About Victory Danses every Five Bucks”
Didnt have to Wait Long
“Zynga was supposed to be public by now, but didn’t want to sell the company with the currently available valuations. It’s only going to get worse.
That is, until there is a “Loudcloud” event, where the IPO goes straight downhill from minute one and it’s all over.”
— tipster
Zynga is a real company with real revenues and huge profits. Impressive growth. So I think the IPO will be successful and may buck the trend of Tipsters “pick the highest peak on day 1 and mock losses” game.
Posted by: eddy at November 9, 2011 5:51 PM
@eddy:
zynga will not be a monster ipo.
i’m afraid your thinking is wishful or maybe magical
sorry, but lux real estate prices aint going up. there is no demand, except for about 200 yards east to west on broadway.
Posted by: johnny at November 10, 2011 8:25 AM
Dot Bomb 2 Blowing up Way Faster VS Dot Bomb 1

” It’s been a month since Facebook’s IPO fell flat and in that time, the market for initial public offerings has collapsed.
No company has gone public since May 18, compared with 19 in the same period a year ago. Fourteen offerings have been withdrawn or delayed, according to Dealogic.”
“”There were a lot of venture capitalists and entrepreneurs that really have been waiting for Facebook to go public,” says Sam Hamadeh, the CEO of PrivCo, a research firm that follows privately held companies. “Everybody’s been told just wait `til May 18, Facebook is going to pop, everybody will get very excited about it … and then you have the opportunity to go public this summer with that halo effect.””
Gotta Put this in for Truthiness
“Of the fourteen IPOs that have been postponed since May 18, it’s unclear if any of those cancellations relate directly to Facebook’s experience. One was Tria Beauty, which makes laser hair removal devices and planned to raise $64 million. Another, Corsair Components, makes computer gaming parts. Both cited poor market conditions.”
http://hosted.ap.org/dynamic/stories/U/US_TEC_IPOS_AFTER_FACEBOOK

ZNGA getting slaughtered.
only so long before music stops and manipulating financials becomes exposed.
going lower

Old Web 2.0
Guy Sells Shares of Socail Network to buy House
New Web 2.0
Guy Sells House to buy entire Social Network
“The Wall Street Journal is reporting that Digg cost Betaworks just $500,000 according to three unnamed sources, adding that such a price is “a pittance for a company that raised $45 million from prominent investors including LinkedIn founder Reid Hoffman and Marc Andreessen.”
http://techland.time.com/2012/07/12/digg-sold-to-betaworks-wsj-reports-buying-price-of-just-500000/

Down 40% After Hours Gotta Give Jonny Guy Mad Props Ed
LIVE: ZYNGA CUTS FORECAST, STOCK FALLS 40%
http://www.businessinsider.com/live-zynga-earnings-2012-7

A company whose main business concept is the sale of virtual assets for actual cash is bound to have both customers and small investors go for the door one day.