Google IPO Open for Registration

Jon Shoberg writes "Google IPO is open for bid registration. From the front page: 'A registration statement relating to Google's Class A common stock has been filed with the Securities and Exchange Commission but has not yet become effective. Google's Class A common stock may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This communication shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of Google's Class A common stock in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. No offer to buy shares of Google's Class A common stock can be accepted and no part of the purchase price can be received until the registration statement has become effective, and any such offer may be withdrawn or revoked, without obligation or commitment of any kind, at any time until the notice of acceptance is sent after the effective date. Of the shares to be sold in Google's initial public offering of Class A common stock, 14,142,135 shares will be issued and sold by Google and 10,494,524 of the shares will be sold by the selling stockholders.'"

Comments

can I have some clarification

[xutopia]

I have no idea what that means.

Re:can I have some clarification

[groupthink]

Means... "you're poor, they're rich". duh

Re:can I have some clarification

[rwiedower]

Here's some information on how an IPO works. As for what google means, that's just silly.

Re:can I have some clarification

[frisket]

I have no idea what that means.

What it says. Martha explained it to me a few days ago...

*sigh*

[bigattichouse]

A convoluted advertisement for the upcoming IPO... of which I will probably not be able to afford - even *with* the Dutch Auction.

Re:*sigh*

[Eccles]

even *with* the Dutch Auction.

I think the Dutch auction works against the investor, and in favor of Google.

Think about Netscape, VA Linux, Red Hat, and other such IPOs. They initially sold at a low price, and the stock skyrocketed the first day. People who got in at the IPO price and sold shortly thereafter made out like bandits -- heck, overall they probably made more than the companies. With Google's approach, there's no reason to expect much of an opening day vault, as the opening ask price comes from the auction price, and who would suddenly pay much more for the stock (once it's in general trading) than they would have shortly before (during the auction)?

Google has a scheme that allows them to pocket all that opening day enthusiasm themselves. Very smart, but there's little reason for small investors to care about the IPO itself as a result.

Not that I know that much about investing and IPOs, mind you.

Re:*sigh*

[r0xah]

I agree that this sucks for those of us who are not rich. I wouldn't mind getting in on the Google IPO 1) to possibly make some money 2) just to have some stock in Google. I think it'd be pretty cool to have at least 1 share in Google and see how they do on the market.

Re:*sigh*

[xmas2003]

I would also suggest that the Dutch Auction works "against" the financial firms bringing firms public.

For "classic" IPO's, the individual investor has a very hard time getting in on the ground floor - i.e. the folks getting most of the offerred shares at the actual IPO prices are the financial firms handling the offering ... and their best buddies/clients - think Frank Quattrone.

So THEY are able to "flip" the shares first day and make a buncha money ... whereas the individual investor typically can't get in until after the POP, when most of the movement is done ... and as noted, the company only gets proceeds at the opening price, not the POP price ... so it is in the financial firm's interest to price as low as possible.

This is why the offering firms aren't too keen about a Dutch Auction ... and it takes someone like Google (who has broad interest) to pull it off. It does seem like they will get one heck of a premium for their stock - note that as often incorrectly noted, it is not the share price that really matters, but the company valuation - i.e. how many shares of stock (total, not offerred) times the share price that is significant - in this case, the number is on the order of 30+ billion dollars - lotta money for a search engine, even a darn good one!

Re:*sigh*

[JJahn]

Correct, this IPO is for people in for the long-haul. If you're looking to get in fast and get out even faster and make some money, Google is not for you. Its not for me either, but thats just because I try to stay away from IPOs (especially tech IPOs) no matter how cool they sound.

Re:*sigh*

[dhovis]

Actually, the Dutch auction works in favor of the small investor AND Google.

In traditional IPOs, the company sells itself to several investment banks at a value below the expected fair market value. These banks sell those shares to their best customers. Sometimes they even give out shares with the stipulation that the investor that received those shares must buy more shares at market price when the stock goes public (an illegal practice that drives up share prices). Once the stock goes public, the share price usually rockets (because it is undervalued) and the investment banks are free to sell their stock and pocket the difference. The company issuing the stock gets none of this money, even though it is part of the "perceived value" of the company at the point of the IPO. This system really benefits the investment banks and their big investors, to the detriment of the company issuing the IPO and small investors.

Small investors usually can only buy the stock when trading goes public. Most small investors are lucky to get in the first day, and by then, the price has skyrocketed. With the Dutch auction, every investor is on equal footing. If you are willing to buy 10 shares at $100, you will win out over somebody willing to buy 100,000 shares at $90. Everybody who gets the stock will buy it at the lowest price at which all share will sell, so if you bid $135 and the final price is $103, you will get the shares you bid for at $103, the same as everyone else.

FWIW, the estimated market cap for Google, based on those share prices, is more than McDonalds, but roughly the level of Yahoo. Is Google worth as much as Yahoo? That is for you to decide. If you think that those prices overvalue Google, don't buy. If you think Google is going to grow to be a $30 billion company in the next decade, then it is a very good investment. You decide...there are always risks in buying stocks.

Re:*sigh*

[TopShelf]

Well written. Another point to note is that since the IPO price is the lowest that sells the total number of offered shares, by definition you have a number of players in the market who would have gladly payed more than the IPO price for Google's stock. So there's very good reason to expect upward trading on IPO day...

Re:*sigh*

[Fortunato_NC]

An IPO is *supposed* to be a financing event. It's only with the dotcom boom that a perception has arisen that the IPO is when you "cash-out" of a company. Traditionally, a company would consider an IPO to raise cash for expansion - it's a means to and end, not an end in itself.

The way Google is conducting their IPO indicates that they view it as a traditional financing event - the higher the IPO price, the more money that's available to the company to expand and grow. In Netscape's IPO, for example, the stock may have closed at $80 at the end of the first trading day, but Netscape itself only realized the $14/share that the offering was priced at. You can bet your bottom dollar that despite all the hype, someone was getting his butt chewed for leaving $66/share on the table. Google's auction doesn't eliminate the possibility of something like this happening, but it does reduce it significantly.

Re:*sigh*

[Eccles]

Abso-friggin'-lutely. I'd bet the CEOs, etc. of other dot-bombs are kicking themselves for not doing the same thing. If it pays off, this could trigger a sea-change in how IPOs are handled, to the dismay of the big financial companies who have been loving those IPO windfalls.

Re:*sigh*

[Blimey85]

Usually small investors can't get in on hot ipo's because the larger investors will buy all of the shares available. Then they immediately sell them for a large profilt. Google has done two things by going with an auction format... first, the little guy who has some money can get in on this just like anyone else. The playing field is a bit more level. Second, Google has found a way to make a killing on selling shares of their company, rather than the first investors through the door profiting so much. It's not like this has come about suddenly. There has been speculation of a Google IPO for quite some time and if you wanted in, you should have been saving up. If you did your homework and put some money aside, Google offering the shares through an auction would probably help you to get the shares immediately whereas with a regular IPO system you wouldn't have been able to buy any until after someone else had gotten them and the price had went way up (most likely). And what is wrong with Google Corp profiting the most on this? After all it is their company. It was/is their ideas and work that brought about their success and I think they should be the ones to profit from that, not the lucky few investors that can get the IPO shares immediately... what Google is doing is a good thing and most people seemed to think so until the price of shares was announced. Now everyone is crying about the shares being too expensive yet they probably wouldn't have been able to buy them any cheaper if Google had done things the normal way, unless of course they know someone with access and some clout.

Re:*sigh*

[Anonymous Coward]

Well written. Another point to note is that since the IPO price is the lowest that sells the total number of offered shares, by definition you have a number of players in the market who would have gladly payed more than the IPO price for Google's stock. So there's very good reason to expect upward trading on IPO day...

Except that those people already got all of the shares they wanted.

For instance, somebody bids $150 for 1000 shares. Say the final bid price that all shares sell at is $110. That investor gets 1000 shares at $110. So they have no incentive to buy more shares above $110, they already got all of the shares they wanted.

Also, they're not limited to just one bid. So they could have bid $150 for 1000 and $100 for 1000. So with a price of $110, they get the first 1000. If the final price was below $100, they would get 2000 for the lower price. Either way, there is no reason for them to want more shares at a price higher than the final bid, since it would be better to just make the bid than change your mind on the first day.

Re:*sigh*

[TopShelf]

Many investors think in terms of dollar value that they'd like to have invested, not a specific number of shares. Your hypothetical investor who bid 1000 shares at $150 was willing to put $150,000 into the stock and still has $40,000 burning a hole in his pocket after the initial allocation...

Re:*sigh*

[Bull999999]

That would imply that people actually learned something from the last boom/bust cycle.

Re:*sigh*

[Scarblac]

If you think Google is going to grow to be a $30 billion company in the next decade, then it is a very good investment.

Now it's not. For it to be worth $30 billion at the moment, it should be worth $30 billion now. If it grows to that size in ten years, you have a profit of 0% over ten years, which is miserable.

Re:*sigh*

[TopShelf]

The problem you have there is if you place those bids, you have to buy shares on all bids at or above the IPO price. So your hypothetical investor here would be on the hook for $900,000 if the IPO priced at $100...

Re:*sigh*

[thrillseeker]

I think the Dutch auction works against the investor, and in favor of Google.

That depends on the investor. If an "investor" is only buying a stock to try to capitalize on a short-term event, then he's not the sort of investor that a company particularly wants to be involved with. A company sells its stock to raise money to do something with. Any company worth owning a piece of wants to establish strong relationships with shareholders - relationships that require trust in each direction - the company wants to find investors that will stick with them through the thin times - the investor wants to find a company that will establish good, but not dramatic, growth of value. If it's too dramatic, it attracts too many hit-and-run investors, which is reflected in a highly variable stock price. Such wild swings in stock prices are, on the average, only good for stock brockers, because they get commissions on trades. It's the very rare person who can guess when to buy and when to sell every time, and you only need to lose all your money once to be broke forever.

An investor knows that what's good for google, is good for me - because he plans to keep that stock for a long time - and so is delighted to see that stock placed in many hands of others with similar long-term growth objectives.

Frankly, anyone buying google stock and planning to flip it quickly will get what they deserve - and that's whether they make money or lose it - if they make money, then great - if they lose, then's that's the breaks. The investor, who buys and holds google stock (and the more hands that stock can be placed in, the longer the hold times are likely to be), will eventually be rewarded with above market-average growth in value. Such a steady growth is how one gets rich - otherwise playing the lottery is cheaper and quicker and less headache.

Re:*sigh*

[MikeBabcock]

If I bid $150 for 1000 shares it doesn't mean I want 1000 shares. It means I'm willing to spend $150000 on Google stock at $150 a share.

If I get those shares for $110 a share, I'll take my $40000 that I saved and spend it on more shares if possible; I was willing to spend $150000, remember?

Re:*sigh*

[dhovis]

OK, I goofed. I guess Google is looking to sell $3billion in stock, representing 10% of the company (if the IPO goes off at the $135 top of the range price). That would give them a market cap of ~$30billion total. My example was suggesting that if the market cap went up by a factor of 10 in ten years ($300billion in this case), then it would be a good investment. I was just using numbers that were an order of magnitude off of the actual IPO numbers.

Re:*sigh*

[fred911]

"If you're looking to get in fast and get out even faster and make some money, Google is not for you"

At mid 100's per share only way to make fast bucks is to short it:-) Don't think you can short an IPO for 90 days, also your broker has to have it before you can sell it!

Re:*sigh*

[Eccles]

Actually, the Dutch auction works in favor of the small investor AND Google.

Agreed, I meant IPO speculators when I wrote investors. You and another have clarified this distinction nicely.

Interesting...

[Short Circuit]

He goes to great lengths to say it's a solicitation, when it's pretty close to being an advertisement.

Re:Interesting...

[smooth wombat]

The above may sound like an advertisement but what Google has posted is standard boilerplate language. When dealing with securities and 'advertising' them you are simply putting the word out that company X has such-and-such securities which you as the public may want to purchase.

Yeah, I know, talk about semantics. Having worked in the financial industry for a time I can tell you there are other oddities that neither you nor I would think of. For instance, did you know that giving a stock quote is considered selling and that if you are not licensed you cannot, legally, give a quote to someone?

Prime Stock

[Aggrazel]

If you add those two numbers together, the number you get is 24,636,659 ... which happens to be prime.

Re:Prime Stock

[zhenlin]

That's not the only thing, they planned to raise e * 10^9 dollars from this IPO. Bless the geeks at Google, for they may not be there anymore...

I don't like the idea

[Anonymous Coward]

With all the hype surrounding this IPO it is sure to drive in some individual investors who would otherwise not commit themselves to such a high level of risk.

This is one of the rare times when an indivudal without millions in worth will have the opprunity to purchase shares from a company's public offering.

In my opinion any individual who purchases these shares is not doing themselves any favor. What is the goal behind buying any? Priced between 108-135 the odds of GOOG appreciating in value anytime soon after the IPO are slim.

Even in their SEC filings they admit in the risks section that they face increasingly greater compettition. They are not immune anymore and I would not want to myself to buy any of these shares nor would I like any family members.

Re:I don't like the idea

[MoonBuggy]

I agree that lowly individuals such as ourselves are unlikely to 'win' on Google stock, but that's why you and I aren't buying it however tempting it may sound. Major investors can put in the time, money and effort to make this pay off, we can stay well clear and anyone who invests without the proper research is asking for it anyway so they might as well throw their money away in Google's direction.

Re:I don't like the idea

[Ignignot]

In my opinion any individual who purchases these shares is not doing themselves any favor. What is the goal behind buying any? Priced between 108-135 the odds of GOOG appreciating in value anytime soon after the IPO are slim.

And you base this on what? Do you have some sort of magical crystal ball that will let you see what will happen in google's future? I'm not saying it will, but I know enough to say that there is no way to tell what direction google's stock will go. If you could, then you'd either buy the stock or sell it and you'd make some money. So would thousands of other investors. The price would change to account for that, and you'd have a new price that takes into account all forward expectations. This is the fundamental reason that the stock market works. People know google is facing strong competition in the future - that's old news, and will be taken into account in the stock price. The only question mark for the IPO is how the market will react to the market. Discovering the expected return or the volatility from the prices will tell investors more about google, and they'll implement strategies accordingly. That's the unknown part of all this.

Re:I don't like the idea

[bergeron76]

Then go for something more sane, like Linspire, Inc. They just priced at $9-11 per share for the August 11th IPO (the day after Google's).

Not!

[Short Circuit]

Not a solicitation. Not a solicitation.

Repeat after me: I will use the Preview button.

(chorus) I will use the Preview button.

Re:Not!

[nelsonal]

I believe legally there is a specific form that must be filed with the SEC that is the only thing that can be used as a solicitation to purchase shares.

U.S. Person

[rwiedower]

Thanks to google, I finally know what a U.S. Person is!

Who knew a "branch of a foreign entity located in the United States" counted?

Re:U.S. Person

[Anonymous Coward]

"US Person" just means that there can't be any doubt that US law applies. A branch of a foreign company in the US clearly has a US presence, pays US taxes etc., so qualifies. It just means that the IPO doesn't have to worry about anyone else's investment regulations - a Frenchman, say, couldn't go running to the french regulator when he lost all his money saying "Those evil google people didn't tell me it was risky".

Re:U.S. Person

[Anonymous Coward]

Thanks to google, I finally know what a U.S. Person is!

This IPO is interesting. Even though I am not a US person (or resident) I own shares that are listed on the NYSE and Nasdaq - I purchased them through a stock broker in my country.

Is there any way for non-Americans to participate in the IPO? While I am not a lawyer, the google requirements sound like non-Americans are excluded.

Rolling in dough

[hrbrmstr]

OK, so 2,4636,659 shares * $135.00USD = $3,325,948,965USD

Is it just me, or are we back in the dot com shenanigans?

Google. 3 *billion* USD. Not worth it (to me at least).

Then again, I'm just a lowly engineer.

Why not more shares and lower price so those of us who *made* Google what it is could have had at least one share?

Sigh.

Re:Rolling in dough

[Anonymous Coward]

Almost got it right -

14 odd million shares offered up by Google *of which* 10.5 million will be offered to the public.

The other part you miss is what percentage of the company these 14 odd million shares represent - this is not *all* of Google on the market but something like 10% of the company.

You need to change that number from 3 billion, to 30 billion.

As to dot-com silliness? Who knows, but better a company that explicitly states that they are gonna try not to be evil than others I suppose.

The founders *will* be billionaires in a short amount of time. That won't suck for them...

Re:Rolling in dough

[hrbrmstr]

Yep. I saw the market cap #'s. What fundamentally amounts to being an advertising placement firm (free search, free e-mail, free news is not a business model) is trying the same boondoggle.

My bet is that the share price drops down to double digits by next year.

boB

Re:Rolling in dough

[ortholattice]

If you are interested in this, remember that the public is getting only a tiny fraction of the 268 million shares outstanding. Several of the officers and directors will each individually own more than the entire public offering combined. See the prospectus. If indeed it fetches around $135 per share, it will create quite a few instant multibillionaires. Now, is this a fair price, or is everyone getting caught up in the hype? I certainly have respect for Google. But if you're thinking of using your money to make these guys obscenely rich, you should at least read the prospectus very, very carefully before making your decision.

Re:Rolling in dough

[TopShelf]

If you look at the prospectus (hahhahaha) the number of outstanding Class A shares after the IPO will be 36,995,863. That is the number which you must multiply by the share price to get a market cap. If they get $120, for example, that works out to well north of $44 Billion. Is it worth it? I can't say for sure. What I can say for sure is that there will be many people bidding on this stock that have no grasp on the actual market that Google is operating in, and whether their growth is sustainable for any length of time.

My bet is that the IPO goes for somewhere around the asking price, but on the first day of trading shoots up to around $150.

Re:Rolling in dough

[hrbrmstr]

Excellent point. I vote "hype".

Re:Rolling in dough

[Alphanos]

Don't forget, they're only selling ~10% of their shares. That puts their total value up around $33.2 billion!

Re:Rolling in dough

[Vacindak]

Two words: Voting Power. Investors are already worried enough as it is about the difference in voting power between the two types of Google stocks. To reduce the price to a more reasonable level while still earning the same amount of money total in the IPO, they'd have to hand out more common stock, thus reducing the comparitive voting power that the owners have. Changing the voting power ratio from 10 to 1 to something like 20 to 1 would just make potential investors more worried.

Re:Rolling in dough

[mr_gerbik]

Then again, I'm just a lowly engineer.

Why not more shares and lower price so those of us who *made* Google what it is could have had at least one share?

A *very* lowly engineer if you don't have $135 for "at least one share."

Re:Rolling in dough

[hrbrmstr]

Just not *dumb* enough to spend 1/2 an iPod on something that may be worth less than your ill spent $0.02USD in two years.

Re:Rolling in dough

[mr_zorg]

I don't think you can add those two numbers together. It says that ~14m shares will be issued, and that ~10m of those will be sold. That does NOT mean there are ~24m shares. I read it as there are ~14m shares, and that the primary shareholders are keeping ~4m of them...

Re:Rolling in dough

[hrbrmstr]

The number I arrived at is pretty much the same (not rounded) as the one all of the major news orgs are tossing about (part of the reason I added them).

Re:Rolling in dough

[ortholattice]

Look at it another way: for each $100 you invest in Google, only $5 to $10 directly benefits Google itself (from your point of view, looking at your percentage of ownership in the company). The rest is essentially a commission that goes to the officers and directors. Granted they worked hard to make Google into a great company, but do they really deserve that much compensation? The public complains bitterly about greed and ethics when CEOs of major corporations get $10 million bonuses, but here these people are effectively getting multibillion dollar bonuses and no one blinks an eye.

To me this is a scam that is fleecing the public, and it is sad they are being hyped into this. Google will have to increase its assets by 10 to 20 times before they will even break even, much less get a positive return on investment. Perhaps it will happen - it's a gamble, of course - but you'll get far better odds and a much lower "house take" in Las Vegas. Most likely these people are just going to lose money in the long run. To me this is an example of greed and public stupidity at its worst (well, at its best if you are one of the lucky few).

$4 / share

[Anonymous Coward]

"... of which I will probably not be able to afford - even *with* the Dutch Auction."

Wait a couple of years. It's not totally unlikely that you could buy it for, say, $4/share in 2 years ... or maybe even less.

Re:$4 / share

[Chess_the_cat]

You don't understand. Parent just wants an opportunity to get rich quick.

Once Google goes public and has to start answering to shareholders you'll start to see Google's dominance come to an end. Just in time for Microsoft's search engine to take over. Beautiful.

Re:$4 / share

[Altanar]

Why would Google have to struggle with it's shareholders? As stated in their Prospectus, page 24: We do not intend to pay dividends on our common stock.We have never declared or paid any cash dividend on our capital stock. We currently intend to retain any future earnings and do not expect to pay any dividends in the foreseeable future. The concentration of our capital stock ownership with our founders, executive officers, employees, and our directors and their affiliates will limit your ability to influence corporate matters. After our offering, our Class B common stock will have ten votes per share and our Class A common stock, which is the stock we are selling in this offering, will have one vote per share. We anticipate that our founders, executive officers, directors (and their affiliates) and employees will together own approximately 84.4% of our Class B common stock, representing approximately 83.1% of the voting power of our outstanding capital stock. In particular, following this offering, our two founders and our CEO, Larry, Sergey and Eric, will control approximately 38.5% of our outstanding Class B common stock, representing approximately 37.9% of the voting power of our outstanding capital stock. Larry, Sergey and Eric will therefore have significant influence over management and affairs and over all matters requiring stockholder approval, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets, for the foreseeable future. In addition, because of this dual class structure, our founders, directors, executives and employees will continue to be able to control all matters submitted to our stockholders for approval even if they come to own less than 50% of the outstanding shares of our common stock. This concentrated control will limit your ability to influence corporate matters and, as a result, we may take actions that our stockholders do not view as beneficial. As a result, the market price of our Class A common stock could be adversely affected. Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable.Our certificate of incorporation provides for a dual class common stock structure. As a result of this structure our founders, executives and employees will have significant influence over all matters requiring stockholder approval, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets. This concentrated control could discourage others from initiating any potential merger, takeover or other change of control transaction that other stockholders may view as beneficial.

Why No Internationals???

[Tr0mBoNe-]

I, being a Canadian, would be interested in buying 1 stock. Just for saying I owe approx. 1/14000000th of half of google. But because I am not a U.S. Person, I am stuck owning a small portion of Nortel stock and a little of Air Canada. (canadians would know why I'm kinda bitter about those)

Yarr.

Re:Why No Internationals???

[Anonymous Coward]

>But because I am not a U.S. Person, I am stuck owning a small portion of Nortel stock and a little of Air Canada

Cheer up dude, you almost got enough for a Tim Horton's Iced Cappuccino!

Re:Why No Internationals???

[Eccles]

I, being a Canadian, would be interested in buying 1 stock.

On the day of the IPO, buy one share. Because of the dutch auction, it shouldn't skyrocket immediately.

Interestingly, though, you do point out a possible cause for an opening day rise; international purchasers.

I'm so confused!

[goldspider]

What are we to think of Google now that they are becoming a publicly traded for-profit corporate conglomerate? Instead of serving the anti-establishment community, they have become the establishment, serving only rich white guys with stock prices out of reach of the common man! They have become everything that Slashdot hates!

way overpriced

[JarrodMJ]

What does a search engine need with $3.3 billion other than $$$ for the board members? I love google as much as anyone but I won't be buying their stock....unless it is in a mutual fund or stock index fund.....

Re:way overpriced

[SumoRoach]

Yeah. I have one. If they made net $105 million last year and will net about $300 million, doesn't that cover quite a bit of research? $3.3 billion would add to their $2.2 billion in cash, but hardly worth what you're saying.

But, to get it straight, it's $36 billion they're raising.

so much for my next big .com boom type of hopes

[jdkane]

We have not undertaken any efforts to qualify this offering for offers to individual investors in any jurisdiction outside of the United States. Therefore, individual investors who are not U.S. persons should not expect to be eligible to participate in this offering.

Good luck to all you "U.S. persons". Let me know how it goes as I sit up here in Canada wishing I could partake.

Re:so much for my next big .com boom type of hopes

[GrassMunk]

why? I mean really the stock isnt going to sky rocket past 200 USD (if it does that). How many shares were you going to buy? 10? 100? 1000? thats 1 350, 13 500 and 135 000. Thats a a lot of money on a maybe. I'm kinda glad we can't partake.

Wimpy

[Anonymous Coward]

I'll gladly pay you Tuesday for some Google stock today!

here we go again...

[CptTripps]

Ok, cross everything you have two of. This could be REAL good, or REAL bad for the tech sector. I, like many others, lost my ASS on Palm when they IPO'd. I only wish I'd have waited a DAY, instead of buying immediately. My $2,000 got me a whopping 11 shares, that turned into 1.1 shares 6mos later when they had a 1-for-10 split. Now it's worthless...

Lesson learned...

Re:here we go again...

[NineNine]

The lesson that you should have learned is that you should not buy a piece of a non-profitable company. That was a stupid gamble.

Been Up For Awhile

[Obiwan Kenobi]

Sigh..

2004-07-31 15:48:04 Google IPO Site Live (IT,Google) (rejected)

It's truly odd sometimes what the /. editors choose to post or not to post (or dupe, for that matter).

Smell that karma burning?

I'm just trying to point out that I think breaking news, such as a site like this going live, should be treated as such, and not when me or many others (I'm sure there have been many others before this one) submit it... :(

Re:Been Up For Awhile

[EnnTeeDee]

Well, it actually went live and was reported elsewhere on Friday the 30th.

Re:Been Up For Awhile

[Chatmag]

Here's one that will crack you up.

2004-07-22 04:01:37 Identity theft case could be largest so far (Index,Security) (pending)

Pending???? it's been pending since the 22nd of last month. I submitted that almost 12 hours before the story was posted, by someone else.

Here are a few other stories that were missed.

Chat Network Operators and Users Wary of "Uniformed" Police Presence.

We had conducted a poll of IRC Server Administrators and chat users to get their reaction. This proposal cuts to the heart of who owns the networks, and how much cooperation should they give, also, do police have the right to enter chat networks uninvited. "The recent proposal outlined by The U.K.'s National Crime Squad (NCS) to monitor Internet chat rooms is not a workable solution, according to Internet chat network owners and administrators. In their statement of 9 June, 2004 the NCS stated that "Uniformed Officers" will enter certain chat rooms, primarily those chat rooms frequented by adults seeking underage children, and have an icon attached to their nickname to identify themselves as law enforcement officers. The F.B.I. is also named as one of the agencies participating in this proposal." The full report is at: Chatmag News Special Reports.

An online vigilante group is harming law enforcement efforts to stop online predators, we have an extensive report regarding this group.

Unrelated question. Is Slashdot having problems, I'm seeing a lot of 503's today.

With $3BN..

[rf0]

Google could buy a 10% stake in Yahoo. Now that would be fun to watch

Rus

Re:With $3BN..

[bmf033069]

In that case, wouldn't you just buy Yahoo stock at $30/share right now instead?

http://finance.yahoo.com/q?s=yhoo

Re:With $3BN..

[scottennis]

I don't think this should have been modded "funny".

My guess is that Google will use the money to start an acquisition binge. Might not be Yahoo, but start looking around at who you think Google might like to buy. (then buy their stock if they are public) You certainly don't need $3 billion dollars to improve search functionality.

When the share price falls

[Albanach]

When the share price falls can we get the folk suing RedHat to start a class action suit against Google too? After all, these tech sahres are only supposed to go upwards are they not?

Google isn't Dot Com Bubble...

[Anonymous Coward]

They are making money.
They do have a stranglehold on the market.
The geeks will still be in charge, The Dutch Auction proves it. I'm sure we've read all the article from Wall Street moaning about how they are getting treated like a B*tch by Google.

We only have to worry if we see the Google-Bowl or a SuperBowl TV Ad.

Here is the real reason for the IPO

[tijsvd]

User Friendly found this out

Cant help myself

[missing000]

"I'm rich, biatch!"

(Teenage girl filter ON)

[Chagatai]

"Hi! Like, we're Google, and we have totally told the SEC that we want to be on the stock market! Ohmygosh! Totally! We're not doing it yet, just like Marsha Mrady, but we will soon! Now, we're not like telling you to buy our stock, but if you really want to, you can totally do it soon! For sure! We're gonna sell, like, 14 million shares, and our totally groovy people who already have, like, 10 million shares, are going to put it all up! This is so cool!

Re:(Teenage girl filter ON)

[Anonymous Coward]

Is anyone else turned on by that?

Comment removed

[account_deleted]

Comment removed based on user account deletion

Floating was lesser of two evils

[anti-NAT]

From what I understand (I'm Australian, so I could be way off base), the SEC in the US require that if a private company has more than a 1000 or maybe 10 000 shareholders, they have to publicly report their financials.

For some reason, floating the company, which also has that reporting requirement, is preferable.

I don't think Google are floating to raise capital, which was the original reason to float a company.

Microsoft didn't float to raise capital either. The problem they had, which is why they were forced to float, was an informal "stock market" sprung up within the company. This is either illegal or frowned upon by the US business regulators.

Re:Floating was lesser of two evils

[Anonymous Coward]

I'm Australian, so I could be way off base

Let me help you out (btw, how's winter this year?):

I don't think Google are floating to raise capital, which was the original reason to float a company.

Nope. Lots of companies are subject to the filing requirement and stay private; although you still have to file, you're not subject to an ungodly number of corporate regulations such as Sarbanes-Oxley, not to mention intense accounting scrutiny. Corporate governance insurance is also much, much cheaper, keeping overhead down for the (existing) investors. There are even companies that are "going private" to avoid the hassle - see Cox's annoucement today, for example.

As I understand it (and I could be wrong), the co-founders of Google were under intense scrutiny by Mike Moritz at Sequoia and John Doerr at Kleiner Perkins - their VCs - to take the company public. You see, these VC firms vie for the title of "greatest ROI" - and in order for these guys to shop around the "we're #1! we got a 30,000% return on our GOOG investment!" claim to the pension funds, they need the company to list.

Once Google goes public, employees will cash out and leave (see: Netscape) - which is why the co-founders really didn't want to go ahead with this, but basically have no choice. It also adds undue scrutiny on them - sure, they're worth $8B in paper worth, but in reality it's a lot better to make $100m a year in cold hard cash while maintaining a low profile; that way you don't have to worry about getting kidnapped while vacationing in St. Tropez.

The only people who will benefit from this move are the VCs.

Microsoft didn't float to raise capital either. The problem they had, which is why they were forced to float, was an informal "stock market" sprung up within the company. This is either illegal or frowned upon by the US business regulators.

Nope. Gates probably took the company public due to 1) youthful vanity (no other way to gain the title of "world's richest man" - which, by the way, is a lie (see, for example, King Fahd of Saudi Arabia, who spends $8m a day in expenses - $3B a year)); 2) extreme harassment from greedy investment bankers / existing shareholders. Gates obviously learned that it was a mistake, as he is on record saying that one of his greatest regrets was taking MSFT public.

Lots of employee-owned companies have "internal stock markets." If I remember correctly, SAIC is a good example.

In conclusion - my advice to all budding entrepreneurs is this - money is only useful when you can do something with it. When everyone knows you've got money, suddenly you are restricted in your options, as you are being scrutinized. Come up with something that people want to buy, sell it to them, make a lot of money, and shut up. The less your competitors and the general public know about you, the less complicated your life is - and the safer you are.

Oh yeah, and never take VC.

No you're not

[Anonymous Coward]

Canadians can buy any stock they want from any country. You can even have some international stocks in your RRSP. The US pushed for years to make sure that Americans could buy anybody else's companies. Of course the rules work in both directions and sometimes Uncle Sam finds that annoying.

There are exceptions. Air Canada for instance. There is a rule that says that 51% of its stock has to be owned by Canadians. The same rule applies to ownership of Canadian media. Of course in the quantities that you and I can buy stocks, such rules don't affect us.

Re:No you're not

[Tr0mBoNe-]

well the reason I hate Air Canada is because by next year, the stock will be worthless and even de-listed from the Toronto Stock Exchange. but as for Nortel, it's comin back. It was down under a dollar a few years ago after being over 75$... if not more. it's at like 5 now. mmmmmm Ice Cap

business model

[esarjeant]

Keep in mind that Google has additional avenues of business available to them. Not only have they built some phenominal search technology, but they have also demonstrated the versatility of Linux and the GooOS at maintaining a vast sea of computing hardware.

In the future it may be a Google-inspired operating system that we run for our enterprise computing tasks. The Google Search Appliance is a targeted business to test the culmination of this technology as a consumer product.

Time will tell, but I suspect this is a more robust company than the dot-bombs of the mid 90's. As always, skip the IPO and pickup stock after the initial boom cycle has given way to bust. Don't forget to read the prospectus and do the math to figure out what the company is *really* worth.

Re:business model

[Donny Smith]

I think their search technology is mediocre - just try searching for anything really popular and you'll see what you get - links to search engine spammers....

Google's cluster: that's a possibility although I don't know (I don't think they know either) what exactly they can do with their cluster at the moment.
Before I've thought about these:
a) enterprise mail hosting
No - it's very competitive and they don't have many features (for example the folders - any MTA would see everything in INBOX)
b) enterprise search
Well they do that already... How many enterprises would let them rather than IBM search internal databases (not just Intranet)?
c) high performance computing - not feasible since their servers are already loaded to a reasonable level..
d) a new generation search - something new such as smart searching of multiple languages with English summaries, image search, etc. This could be cool but there's no reason to believe Google can do that better than any of existing companies already specialized in those fields.

They're too dependent on ads and the field is very very competitive. I don't think they'll be able to sustain this share price.

square root of 2?

[Anonymous Coward]

is there a reason Google chose to offer (2 ^ (1/2)) * 10,000,000 shares? is the square root of two an important number in the stock market?

oh, and it looks like they forgot to round up: (2^(1/2))*10,000,000 = 14,142,135.623... or 14,142,136

Re:square root of 2?

[dgenr8]

I noticed that too. It's probably the closest "cool" number to the actual number of shares they wanted to offer.

So if this is an auction IPO...

[Jedi Holocron]

...does this mean I can use my eBay Anything Points?

I have a butt-load of United miles I'd like to convert and use before they go bankrupt for good.

clsses of shares

[Sivaram_Velauthapill]

Google issuing multiple types of shares is very lame. I'm neither interested in buying the company nor do I have the money, but having common shares with very little voting power, while having another voting class that is held by the insiders is old school. It's very unusual in the tech industry and it is very elitist.

Re:clsses of shares

[nelsonal]

Everything I've seen from Google's management says we don't give a rat's @$$ about the IPO process. A company like this that really wanted to go public with aplomb would easily raise nearly as much money and end with a market cap north of $60 billion (lot's of unofficial advertising support). Count the investment banks that piled on even though they all realize that they probably won't make much money, after they install systems to allow the auction. People have been excited about buying Google for more than 3 years, and management is doing everything they can to keep the IPO price down share classes, the registration statement, bankers getting hosed (that's like constantly reducing your sales commission the bankers are little more than well dressed salespeople), and not giving any real information about their company's operations or financials. They don't want a big IPO from everything I've seen.

Re:clsses of shares

[Sivaram_Velauthapill]

lol that's true :) A lot of people seem to be content to let the owners control it well into the future; while another bunch don't like the ownership plan...

My point is that you don't need to have these special shares. The founders already own a huge chunk of Google and if they want to keep control of it, they can keep their shares (as opposed to selling it). By creating the special shares, the founders want both: control and wealth. The first is achieved by owning the class B (or whatever) shares, while the latter is achieved by selling the common shares.

In the short term none of this will matter. But the long-run is another story. The time will come when the owners will do a bad job and have to be replaced. If they owned voting rights then they will always control the company. Short and medium term investors wouldn't care about the voting rights but long-term ones will definitely do.

Damn...

[jdtanner]

...I just checked my washing label and I'm not a 'U.S. Person' :-(

Internet Search engine companies are a dime dozen.

[zymano]

Theres one here in K.C. that got $500,000 dollars in funding in support. I don't like that at all. Probably be bankrupt within a year. Good scam for the Silicon valley guy that moved from there to here. Anyways search engines are all the same to me. Google ,no different. I would not put any money in google stock . Wait for it to settle if you are.

Existing stockholder average share price: $0.35

[mjfrazer]

https://www.ipo.google.com/data/prospectus.html#to c16167_10

Elitism, or....?

[lysium]

It's very unusual in the tech industry and it is very elitist.

But then the short-term mindset of 'populist' investors is the only other option. The more people you include, the lower you must go to find common ground; in this case, that common ground is ignorant (rather than informed) greed.

Re:Wikipedia

[cdaneg]

http://en.wikipedia.org/wiki/Online_Copyright_Infr ingement_Liability_Limitation_Act/

Do you Yahoo!?

[napesjp]

I can't wait to buy stock from a company that earns no money, only to see it come crashing down.

Re:Wikipedia

[cdaneg]

thanks

Google

[nukeade]

I don't see why Google expects their IPO to bring so much money. Realistically, a shareholder should buy stock if they plan for the company to have greater value in the future, e.g. some product or service of appreciable value. While their search engine is second to none, it's ultimately free to use, and you can't tell me that with pay-for-position fees and maybe banner ads are going to be worth much at all. And what would they do with all of this newfound finance money? Buy out another search engine or speculative associated product?

While Google is certainly great work, I just don't think a search engine is worth all that much in the big scheme of things. I expect that they want this to turn into a dot-com style cashout as a larger company buys them up. This certainly isn't a bad time to do so, as the competition is growing and Google may have trouble maintaining its clear #1 status much longer.

~Ben

Not exactly

[dinodriver]

>If you think that those prices overvalue Google, > don't buy. This way is more savvy: if you think that the rest of the investors out there will feel that those prices overvalue Google, then don't buy. In other words, many people have made lots of money buying stocks at prices they personally thought were crazy considering the financials of the company, but they bought it anyway because the knew there are a lot of crazy investors out there to drive the price up further anyway. I know it's not 1999 anymore but...you never know.

Re:*giggles*

[Bullet-Dodger]

Wow, never thought I'd see financial-trading terminology flamewars on slashdot.