Selling Google - why?
Unless you've been on a desert island you're probably aware that Google plans floating (at least according to media reports), some time in the new year. Given that the markets are starting to return to some kind of stability but are still below where they probably should be, why? Why not wait a year or two and do it then? Are they afraid that either they've reached a peak, technology-wise, or that someone is going to come along and knock them off their perch as number one?
hand.bird == 2 * bush.bird
"still below where they probably should be"
1. Raise some cash without venture capitalists, perhaps to develop something even greater, or simply to get rich.
now is a great time to sell. they have developed a search engine that many other places are now copying. the have alot of traffic that many others are now trying to get. for the original people maybe the fun is over.
They're a verb. Not even Amazon pulled that off. :)
They're much better off selling now. Gullable people will buy the shares and they can make a fortune.
Sum Dum Gai
even the NYSE and Goldman Sachs sold themselves during the peak of the boom. Let the buyer beware.
I think their market cap will be bigger right now than it will be in a few years. They probably think the same thing.
"markets are _exactly_ where they should be. They always are"
Sometimes it amazes me that people still believe in Markets.
Markets are always where they should be. That is the clearing price is the price that the next person is willing to pay.
If you mean me, Ged, I don't believe in them, or at least - I believe they exist, but don't believe they fulfill the purpose for which they were created nor follow sensible economic principles. What I haven't managed to work out is whether the stupid follow the greedy or the greedy follow the stupid.
If you define "the right price" as "any price that people are willing to pay" then the statement "markets are always at the right price" is vacuous. It is, of course, difficult to give an obviously-better definition of "right" in this context, but here's one possibility. Imagine that some miracle makes all participants in the market much less irrational and supplies them with all the publicly-available information that's relevant to their buying and selling decisions. The "right price" is what would emerge in that slightly idealized market.
That the markets are always at the right price is not a vacuous statement. It's more of a truism.
Hmmm, no one seems to think that Google wants the money for the usual reasons (besides the getting-rich reason): to enter new markets, develop new products and services, and so forth.
The "get rich" argument probably doesn't pan either. Estimates are that they generate profits of about 100M USD/year. I suppose there is "rich" and "stupidly obscenely excessively rich" so maybe they are just going for the latter :^)
Why an IPO? Easy, right now the owners of Google basically have all their eggs in a single basket. Should (or when) another search engine become more popular (or advertising rates sink even lower...), the majority of all their
I've heard that there's a rule (SEC, I presume) that a company is required to go public if the company wishes to expand ownership beyond a certain number of people. Since Google is growing, they may have to go public to be able to offer company shares to recruit/retain top talent. Can anyone confirm this rule?
A company never needs to go public, but if it has beyond some number of shareholders (500?), it needs to report the same revenue / earnings numbers as a company that is public. Or something like that.
It's possible that they feel pressure to go public from the top talent they've recruited in the past - they presumably gave away lots of stock options to attract people, and now these people would like a way of getting cash instead. In this point, it's not necessarily that these people think it's a good time to sell, just that it'd be nice to turn some of that paper money into real money.
They seem to be following the Microsoft model, rather that the .com model. Microsoft was already a strong, successful business when they went public. Google will be too.
""markets are _exactly_ where they should be. They always are""
I already did. It is in (UK) property.
suggesting that you think UK property is undervalued??
The properties I have were, yes.
Just out of interest, what is your opinion of the property market at the moment??
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