An IPO

The initial public offering of our online sock company.

Category:

Education

Tags:

• ipo
• initial
• public
• offering
• syndicate
• underwriters

[sidyadav]

News flash: Sal has 8,000 subscribers, 224,000 channel views, and millions of vews in aggregate on his videos. All 768 of them have the same "black-board-style-hand-writte­n" presentation to them, and millions of people have learned millions of valuable things from them successfully that way.

Did you really expect Sal to change because of your one comment?

I like the format because it's so spontaneous -- Sal can show anything at anytime. A prepared PPT would make people want to kill themselves.

[dieonyourfeetDEC16]

I did a business minor so I knew the basics of an IPO. My question has always been, after receiving the cash from an IPO, why do companies care so much about the stock price in the secondary market, it seems most companies and investors are obsessed with the price of the stock. It seems that this price can't affect the profitability of the company. Is it to have more ability to raise capital later? issuing more shares later? is this common practice, issuing more and more shares?

[iNinjaNotes]

@dieonyourfeetDEC16 Finally, it is very common for additional private placements because unless the company is operating cash flow positive, they'll need to either A) refinance (debt or equity/share offerings) or B) Sell assets. Private placements are common for companies that are trying to grow. For example, many gold companies decide to initiate PP's to continue exploration or to finance a mining facility. However the latter is usually a hybrid of debt/equity. Hope that clears it up!

[iNinjaNotes]

@dieonyourfeetDEC16 Also, a worse share price means when they want cash, they'll have to issue a LOT more shares. More shares = more dilution which means a smaller EPS share. This means less profit per owner of the company. Which is a big deal when your operating publicly.

[iNinjaNotes]

@dieonyourfeetDEC16 Secondly, you were right when about additional offerings. If the company is not a cash cow, it might have to place additional private placements. Which are offering shares usually to wealthy clients at different brokerages, but many retail investors may also subscribe. If they don't care about their share price then nobody will want to subscribe to their placement. No interest = No cash.

[iNinjaNotes]

@dieonyourfeetDEC16 Good question. After a company performs an IPO, it is true that they receive the cash and they offer shares in return. After the IPO the secondary market may seem like it doesn't affect the company but it does. For one, the company has management and directors that are granted stock options that provide an incentive to be obsessed with getting their ticker as high as possible. That way they may exercise them for secondary income on top of their salaries.

[docbaddass]

he has a top hat. and thank you very much for you for the vids dude

[konjyoman]

@gitgit42 I love those, can't find them anywhere!

[TheFambrough]

Im looking for IPO'S that I can offer low Credit Card Rates and ACH. We own our platform. M2 World Widellc.com 727-498-0007

[toplad007]

Amazing video. This part had me really laughing where you said 'Maybe the angel investor had an expensive divorce settlement!' superb

[UneJizz]

LOOOOLLLLLL the top hat dude... i am thoroughly enjoying this series sal, keep it up