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(Business Insider)   Investors who are surprised to have lost money on the Facebook IPO obviously didn't bother to read the IPO document where it tells them that Facebook's revenues are on the decline   (businessinsider.com) divider line 53
    More: Amusing, Facebook IPO, Mark Zuckerberg, IPO, Facebook, prospectus, decline, revenues, shareholders  
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1619 clicks; posted to Business » on 04 Sep 2012 at 3:00 PM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-09-04 01:52:59 PM
$10 is the buy price for me.
 
2012-09-04 02:58:07 PM
Anyone who bought facebook deserves to lose money. I don't even invest seriously, and even I was reading articles MONTHS in advance saying that this stock was a classic lemon.
 
2012-09-04 03:00:32 PM

CPT Ethanolic: Anyone who bought facebook deserves to lose money. I don't even invest seriously, and even I was reading articles MONTHS in advance saying that this stock was a classic lemon.


the stock's not necessarily a lemon, but the growth assumptions built into the IPO price were certainly ridiculous.
 
2012-09-04 03:06:59 PM
Do Not Like. Share. Comment.
 
2012-09-04 03:07:07 PM
Pshaw! Profits don't matter. This is the new e-conomy.
 
2012-09-04 03:13:38 PM
California and Oregon PERS (Public Employee Retirement funds) invested hundreds of millions in that IPO. Neither will disclose just how much they have lost. Some estimates are in the hundreds of millions.
 
2012-09-04 03:23:57 PM
It's like a girl who says "yeah, you can take me to dinner, but I'm not sleeping with you..." then, after dinner, you get all pissy because she won't sleep with you.
 
2012-09-04 03:29:54 PM
"Facebook's business exists to support Facebook's product development, not the other way around."

This, in a nutshell, is why most technology companies fail.
 
2012-09-04 03:34:15 PM

stonicus: It's like a girl who says "yeah, you can take me to dinner, but I'm not sleeping with you..." then, after dinner, you get all pissy because she won't sleep with you.


And then you go on Fark and complain that you're such a nice guy, but you can't get any because these dumb girls only like jerks. How come they don't like nice guys like me that act nice to get sex? Why oh why?
 
2012-09-04 03:39:01 PM

stonicus: It's like a girl who says "yeah, you can take me to dinner, but I'm not sleeping with you..." then, after dinner, you get all pissy because she won't sleep with you.


Yup.

A prospectus is more than just a required document filled with boilerplate. It's an actually helpful document that can help you make an informed decision about an investment decision.

If you are looking to take part in an IPO, you need to know what kind of revenues the company has, how those translate into profits (if at all), their plans to get/remain profitable, what kinds of dividends they plan to pay, and so on.

When the prospectus says "We're not making any money now, we aren't going to make any money in the near future, and to top it all off we aren't likely to make any money in any foreseeable future," it's a VERY good idea to invest elsewhere. No matter how much you like the product or how trendy it is, if they can't make any money you'll lose your shirt by investing.

I saw it happen with Vonage (I thought about investing with their IPO, and their prospectus basically said the above), and dang if the stock didn't tank. I figured the same would happen with Facebook.
 
2012-09-04 03:57:27 PM

Rent Party: "Facebook's business exists to support Facebook's product development, not the other way around."

This, in a nutshell, is why most technology companies fail.


Yes, because they do exactly the reverse.
 
2012-09-04 04:00:24 PM
Heh. I bet a buddy on IPO day it would be at $20 before fall. Turns out even that was optimistic. They still have the gargantuan insider shares mostly locked up. They'll be looking up at $10 before xmas.
 
2012-09-04 04:00:48 PM

CheatCommando: Rent Party: "Facebook's business exists to support Facebook's product development, not the other way around."

This, in a nutshell, is why most technology companies fail.

Yes, because they do exactly the reverse.


No, they convince themselves that they are there to build this cool widget, and that because it is so cool that money will automatically appear as it only does for special snowflakes with the Idea That No On Thought Of Before.

Product management exists to support a business. If no one is buying the product, you either change the product, or you go out of business.
 
2012-09-04 04:02:00 PM

akula: A prospectus is more than just a required document filled with boilerplate. It's an actually helpful document that can help you make an informed decision about an investment decision.


Whatever. My Goldman Sachs personal financial advisor knows more than what some pencil-necked penny pusher cobbled together. He said it's totally a sure thing, easy money, so long as he makes his sales numbers. He signed me up for $250k, and I can't wait to spend the profits. I haven't heard from him lately, perhaps I should go check the value of my stock.
 
2012-09-04 04:02:46 PM

akula: I saw it happen with Vonage (I thought about investing with their IPO, and their prospectus basically said the above), and dang if the stock didn't tank. I figured the same would happen with Facebook.


When the only people who pay you are advertisers, and your "customer base" is people who signed up for free and ignore the ads, it doesn't take a genius to discover where the revenue problems might be.
 
2012-09-04 04:09:49 PM

Rent Party: CheatCommando: Rent Party: "Facebook's business exists to support Facebook's product development, not the other way around."

This, in a nutshell, is why most technology companies fail.

Yes, because they do exactly the reverse.

No, they convince themselves that they are there to build this cool widget, and that because it is so cool that money will automatically appear as it only does for special snowflakes with the Idea That No On Thought Of Before.

Product management exists to support a business. If no one is buying the product, you either change the product, or you go out of business.


No, they go into business thinking that if they work without a salary they will get stock options and become zillionaires in the IPO. They are not really technology companies, but poorly thought out multilevel get rich quick schemes.

If you are running the business to support the product you don't have to worry so much about the parasites, which is what is happening with Facebook now, and as the article notes, with Amazon before it. Both of them are structured in such a way that the investors are along for the ride, but have no say other than to sell their stock. It's pretty much the way Morgan organized his ventures, and he was famous for saying the only communication he owed his shareholders was their dividend checks. If they didn't like them, they were welcome to sell their shares to someone who did.
 
2012-09-04 04:19:33 PM
This is what happens when people buy stock in a certain company because it is the cool thing to do.
 
2012-09-04 04:22:17 PM

CheatCommando:

If you are running the business to support the product you don't have to worry so much about the parasites, which is what is happening with Facebook now, and as the article notes, with Amazon before it. Both of them are structured in such a way that the investors are along for the ride, but have no say other than to sell their stock. It's pretty much the way Morgan organized his ventures, and he was famous for saying the only communication he owed his shareholders was their dividend checks. If they didn't like them, they were welcome to sell their shares to someone who did.


You know Bezos was (and is) a finance guy, right? And that Amazon has changed their product lineup several times over they years, because the current one wasn't doing it?
 
2012-09-04 04:37:53 PM
Since when did revenue have anything to do with share price?
 
2012-09-04 04:38:26 PM
The reason why the CFO issued more stock shares at a higher initial price had nothing to do with investors earning money. The CFO wanted as much of their money as he could get and he got it.

Tough rockos, idiots. I guess you thought people were just going to give you money and you didn't have to do a damn thing. Har har har.
 
2012-09-04 05:00:48 PM
I'm so overwhelmed with schadenfreude, my wife told me to knock it off the other day.
 
2012-09-04 05:02:02 PM

Spare Me: California and Oregon PERS (Public Employee Retirement funds) invested hundreds of millions in that IPO. Neither will disclose just how much they have lost. Some estimates are in the hundreds of millions.


Link please.

I didn't hear that about OR-PERS, and would be pissed (well more pissed) at them.
 
2012-09-04 05:03:37 PM
Oh, and so far, the only source I can google for the claim is... you, here on Fark.
 
2012-09-04 05:23:13 PM

meat0918: Spare Me: California and Oregon PERS (Public Employee Retirement funds) invested hundreds of millions in that IPO. Neither will disclose just how much they have lost. Some estimates are in the hundreds of millions.

Link please.

I didn't hear that about OR-PERS, and would be pissed (well more pissed) at them.


I haven't heard it about CalPERs either and my google-fu only brought up articles about the anemic return of 1% that CalPERs has had this year (or past year).
 
2012-09-04 05:38:28 PM
Anyone who invests in social media doesn't deserve their investment money.

Anyone who uses social media doesn't deserve their privacy.

Long live the new flesh.
 
2012-09-04 05:38:37 PM

Spare Me: California and Oregon PERS (Public Employee Retirement funds) invested hundreds of millions in that IPO. Neither will disclose just how much they have lost. Some estimates are in the hundreds of millions.


I am willing to bet that the financial "professionals" that made that move are some of the highest paid civil servants in California, presumably because htey are so much smarter than everyone else and unquely qualified to manage such large funds.

The FB IPO couls serve as a litmus test of fitness to handle your own brokerage account. If you actually bought FB stock, do not make another trade and immediately hand over control of your portfolio to someone that knows what they are doing before you get all your money taken from you..
 
2012-09-04 05:46:57 PM
I think its a good thing that some American company got to scam tens of billions from American suckers. There's less for the Nigerian e-mailers to get, and obviously, they scam from the same pool of idiots. It keeps the money in the US
 
2012-09-04 05:47:47 PM

Pumpernickel bread: Spare Me: California and Oregon PERS (Public Employee Retirement funds) invested hundreds of millions in that IPO. Neither will disclose just how much they have lost. Some estimates are in the hundreds of millions.

I am willing to bet that the financial "professionals" that made that move are some of the highest paid civil servants in California, presumably because htey are so much smarter than everyone else and unquely qualified to manage such large funds.

The FB IPO couls serve as a litmus test of fitness to handle your own brokerage account. If you actually bought FB stock, do not make another trade and immediately hand over control of your portfolio to someone that knows what they are doing before you get all your money taken from you..


The OPERS investment portfolio is described in full for each annual report put out by the Oregon Treasurers office. Wait for the 2012 annual, and you'll know just how much they pumped into that pit.

In the mean time they are heavily invested in public debt, Apple, JP Morgan, Pfizer, GlaxoSmithKlien, Exxon, Chevron, and Vodafone.

The real crime is the $300 million in fees that the investment managers pulled out of the fund for "managing" the $60Bn or so in assets.

You Oregon hippies aught to get some pitchforks and torches out for that.
 
2012-09-04 05:50:18 PM
But remember: regulating the financial industry is bad for America!
 
2012-09-04 05:55:00 PM

Rent Party: Pumpernickel bread: Spare Me: California and Oregon PERS (Public Employee Retirement funds) invested hundreds of millions in that IPO. Neither will disclose just how much they have lost. Some estimates are in the hundreds of millions.

I am willing to bet that the financial "professionals" that made that move are some of the highest paid civil servants in California, presumably because htey are so much smarter than everyone else and unquely qualified to manage such large funds.

The FB IPO couls serve as a litmus test of fitness to handle your own brokerage account. If you actually bought FB stock, do not make another trade and immediately hand over control of your portfolio to someone that knows what they are doing before you get all your money taken from you..

The OPERS investment portfolio is described in full for each annual report put out by the Oregon Treasurers office. Wait for the 2012 annual, and you'll know just how much they pumped into that pit.

In the mean time they are heavily invested in public debt, Apple, JP Morgan, Pfizer, GlaxoSmithKlien, Exxon, Chevron, and Vodafone.

The real crime is the $300 million in fees that the investment managers pulled out of the fund for "managing" the $60Bn or so in assets.

You Oregon hippies aught to get some pitchforks and torches out for that.


The hippies are too busy being wooed by the anti tax people to give a damn and are currently preoccupied with Occupy and the propose coal export terminals in the PNW.
 
2012-09-04 06:04:18 PM

meat0918:
You Oregon hippies aught to get some pitchforks and torches out for that.

The hippies are too busy being wooed by the anti tax people to give a damn and are currently preoccupied with Occupy and the propose coal export terminals in the PNW.


Is Occupy still a thing? I thought the all got bored and went home when their iPod batteries died.
 
2012-09-04 06:04:39 PM

stonicus: It's like a girl who says "yeah, you can take me to dinner, but I'm not sleeping with you..." then, after dinner, you get all pissy because she won't sleep with you.


Well, she shouldn't have went to dinner, if she wasn't going to sleep with you.
 
2012-09-04 06:06:07 PM

Rent Party: meat0918:
You Oregon hippies aught to get some pitchforks and torches out for that.

The hippies are too busy being wooed by the anti tax people to give a damn and are currently preoccupied with Occupy and the propose coal export terminals in the PNW.

Is Occupy still a thing? I thought the all got bored and went home when their iPod batteries died.


Oh yes, at least in Eugene. Link
 
2012-09-04 06:09:44 PM

meat0918: Rent Party: meat0918:
You Oregon hippies aught to get some pitchforks and torches out for that.

The hippies are too busy being wooed by the anti tax people to give a damn and are currently preoccupied with Occupy and the propose coal export terminals in the PNW.

Is Occupy still a thing? I thought the all got bored and went home when their iPod batteries died.

Oh yes, at least in Eugene. Link


Wow. That's just.... sad.
 
2012-09-04 06:22:47 PM
It's down from a $109 billion to $38 billion, and Zuckerberg himself went from $30 billion to $10 billion. I wish MY portfolio could lose 2/3 of its value and still leave me rich as shiat.
 
2012-09-04 07:02:04 PM
How about Myspace stock?
 
2012-09-04 08:28:22 PM
I kind of respect Zuckerberg for this attitude. The fact of the matter is, investors are morons, and only look at the short term. Too many companies have been ruined by only caring about the next quarter, instead of the next 5-10 years. If you want your business to last for the long term, you have to think long term. Don't like it? Don't invest.
 
2012-09-04 08:30:31 PM
This article lists the tranches of restricted shares that become available on the market down the road. I can almost guarantee you that FB stock will dive just after each date:

Oct 29 - 124 million shares
Nov 14 - 28 million shares
Dec 14 - 156 million shares
May 18 - 47 million shares

FB is up a little in after hours trading because Zuckerberg just filed an 8-K that says he doesn't plan on selling any shares for 12 months.

FB will be a $10 stock by Christmas because you know people are going to want to ditch 308 million shares while they can.
 
2012-09-04 10:36:12 PM
If commercial data mining isn't a large component of a social media company's business model, then that company will ultimately fail. That is the only viable long-term product that they have to sell.
 
2012-09-04 11:54:47 PM
AOL was extremely hyped on IPO day too, and they're doing just fine as well.
 
2012-09-05 12:08:17 AM
Read the prospectus.

Still thought facebook was going to be like yahoo, at the very least a quick flip.

Then Zuckerberg bought instagram for 1 billion.

No due dilligence.

Approved by a board that didn't do due dilligence.

The company doesn't know how to be a big company.

Didn't invest.
 
2012-09-05 01:07:16 AM

rdu_voyager: This article lists the tranches of restricted shares that become available on the market down the road. I can almost guarantee you that FB stock will dive just after each date:

Oct 29 - 124 million shares
Nov 14 - 28 million shares
Dec 14 - 156 million shares
May 18 - 47 million shares

FB is up a little in after hours trading because Zuckerberg just filed an 8-K that says he doesn't plan on selling any shares for 12 months.

FB will be a $10 stock by Christmas because you know people are going to want to ditch 308 million shares while they can.


you do know that all this information is already priced into the stock, right?
or do you think you are the only one who knows this?
 
2012-09-05 02:18:40 AM

CPT Ethanolic: Anyone who bought facebook deserves to lose money. I don't even invest seriously, and even I was reading articles MONTHS in advance saying that this stock was a classic lemon.


Should we just redistribute wealth based on IQ tests and save everyone the suspense and crushing of dreams?

I agree it was pure stupidity to buy facebook, doubly so to hold, but why do we encourage the robbing of the stupid?
 
2012-09-05 03:44:04 AM
"26-year-old Facebook CEO Mark Zuckerberg"
26
26
26


/G+
 
2012-09-05 03:48:17 AM

Rent Party: Is Occupy still a thing? I thought the all got bored and went home when their iPod batteries died.



Go fark yourself
 
2012-09-05 04:54:52 AM

Mikey1969: It's down from a $109 billion to $38 billion, and Zuckerberg himself went from $30 billion to $10 billion. I wish MY portfolio could lose 2/3 of its value and still leave me rich as shiat.


He sold a shiat load of shares at $40 a few days before his wedding he'll be just fine.
 
2012-09-05 05:44:26 AM

meat0918: Spare Me: California and Oregon PERS (Public Employee Retirement funds) invested hundreds of millions in that IPO. Neither will disclose just how much they have lost. Some estimates are in the hundreds of millions.

Link please.

I didn't hear that about OR-PERS, and would be pissed (well more pissed) at them.


A simple google search comes up with this information:

Early this month the state's Legislative Analyst's Office reported that because of the near 50% decline in Facebook stock from its $38 a share offering price, "hundreds of millions of dollars of income tax revenue assumed in the state budget plan are at risk." It'll be even worse if other young tech companies don't go public or do so at lower valuations. The Facebook falloff comes after state tax collections in the first half of 2012 had already fallen $3.5 billion below earlier estimates.

Despite this, the State Legislature and Governor Brown have approved funding high-speed rail, took a weak jab at reforming public employee pension plans and assign their greatest hope to the passage of a "temporary" tax increase on the November ballot.


So basically Jerry Brown cooked the books by factoring in a $38/share facebook value along with a currently non existent tax increase. I am sooooo hoping that tax increase gets voted down this November.
 
2012-09-05 11:25:41 AM

tenpoundsofcheese: rdu_voyager: This article lists the tranches of restricted shares that become available on the market down the road. I can almost guarantee you that FB stock will dive just after each date:

Oct 29 - 124 million shares
Nov 14 - 28 million shares
Dec 14 - 156 million shares
May 18 - 47 million shares

FB is up a little in after hours trading because Zuckerberg just filed an 8-K that says he doesn't plan on selling any shares for 12 months.

FB will be a $10 stock by Christmas because you know people are going to want to ditch 308 million shares while they can.

you do know that all this information is already priced into the stock, right?
or do you think you are the only one who knows this?


I think you are giving traders and the algorithms behind high frequency trading entirely too much credit. If you are righ,t and traders factor everyting in, how do you explain the dramatic change in the price of FB when nothing has really changed since the IPO? Pretty close to all of this was known when the company was trading over 32. The only explanation is that there are a lot of uninformed idiots buying and selling and apparently some of those idiots are managing some very large pension funds.
 
2012-09-05 12:18:01 PM

Rapmaster2000: stonicus: It's like a girl who says "yeah, you can take me to dinner, but I'm not sleeping with you..." then, after dinner, you get all pissy because she won't sleep with you.

And then you go on Fark and complain that you're such a nice guy, but you can't get any because these dumb girls only like jerks. How come they don't like nice guys like me that act nice to get sex? Why oh why?


Once, just once, I want to see a guy say, "Oh? Well, never mind then." and just walk away. Such a man would be my hero.

/can't try it myself, gettin' married
 
2012-09-05 01:27:15 PM

intelligent comment below: Rent Party: Is Occupy still a thing? I thought the all got bored and went home when their iPod batteries died.


Go fark yourself


Did your iPod battery die?
 
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