tag:blogger.com,1999:blog-8152901575140311047.post3746991518321865107..comments2024-03-27T09:01:53.517-04:00Comments on Musings on Markets: Stay Private vs Going Public: Changing landscapeAswath Damodaranhttp://www.blogger.com/profile/12021594649672906878noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-8152901575140311047.post-76403350992494927412011-08-01T04:57:52.805-04:002011-08-01T04:57:52.805-04:00So here's a thought experiment: i form a compa...So here's a thought experiment: i form a company with 1B shares, and i sell 1 share to you at $1. now my company has a $1B valuation :D<br /><br />now, isnt this what Facebook and other internet startups are raising money on?<br /><br />as you propose, shouldnt percentage of float be a factor in valuation?The Doors Of Perceptionhttps://www.blogger.com/profile/11274346399107955756noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-29758081906108353322011-07-26T08:20:46.752-04:002011-07-26T08:20:46.752-04:00Dear Professor,
Thank you for the clarification. ...Dear Professor,<br /><br />Thank you for the clarification. If you have any research paper on this topic I'd appreciate a copy.<br /><br />Thanks once again.<br /><br />TharaLankan Marketshttps://www.blogger.com/profile/00458611328699964962noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-36406257566396669312011-07-26T07:50:52.132-04:002011-07-26T07:50:52.132-04:00The cost of equity to a public company is lower th...The cost of equity to a public company is lower than the cost of equity to an otherwise similar private company. The cost of equity for both will be higher than the cost of debt.Aswath Damodaranhttps://www.blogger.com/profile/12021594649672906878noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-80907362749148301712011-07-26T03:07:20.209-04:002011-07-26T03:07:20.209-04:00Dear Professor,
In your post you mention one plus...Dear Professor,<br /><br />In your post you mention one plus side as 'more capital at lower cost'. I'm concerned if equity is low cost? Coz in our basic finance course we learn that equity is the highest cost component. Appreciate if you could clarify.<br /><br />Thanks you.Lankan Marketshttps://www.blogger.com/profile/00458611328699964962noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-61491026112482750302011-07-25T21:17:56.053-04:002011-07-25T21:17:56.053-04:00Brendan. You are right, though attempts are being ...Brendan. You are right, though attempts are being made to ease the 500 shareholder rule.Aswath Damodaranhttps://www.blogger.com/profile/12021594649672906878noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-37263484538937886692011-07-25T09:07:57.936-04:002011-07-25T09:07:57.936-04:00Isn't there already some degree of regulation ...Isn't there already some degree of regulation of private share markets with the 500 shareholder rule and the requirement to be a qualified investor?<br /><br />Another interesting development with these private markets is the valuations that get attached to private companies (with no public financial data) that eventually set expectations for management to deal with. This happens in public market as well, but in theory it is more rational (there are filings to use as a starting point).Brendanhttps://www.blogger.com/profile/01431617688452112127noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-72171203853420732982011-07-24T20:47:17.261-04:002011-07-24T20:47:17.261-04:00Although I doubt it will be repeated regularly, a ...Although I doubt it will be repeated regularly, a 180% (35 -> 83) premium for liquidity and transparency seems like a good deal for LNKD investors.Johnhttps://www.blogger.com/profile/02034345955061025541noreply@blogger.com