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Man Becomes 'Accidental Millionaire' After Jet.com's Sale To Walmart (fortune.com)

Posted by BeauHD on from the accidental-department-name dept.

The acquisition of Jet.com by Walmart for $3 billion in cash appears to have made the founder of IdeaDash an "accidental millionaire." Fortune reports: "Martin, who is the founder of a startup called IdeaDash, won Jet.com's nationwide marketing competition -- Jet Insider -- in early 2015. The contest offered a reward of 100,000 shares of Jet stock to the contestant who got the most people to sign up for 6-month free trial 'insider' memberships to the membership shopping site, a sort of online Costco or Sam's Club. According to his company's website, Martin took first place out of the 350,000 people who participated, getting over 8,000 people to sign up. Martin spent $18,000 on online ads, Bloomberg reports, and now has a stake in Jet that is reportedly worth millions. Although Martin told Bloomberg that he is not sure exactly what his stake is worth, Fusion reported in February 2015 that his piece could be valued between $10 million and $20 million."

5 of 43 comments (clear)

  1. More like by Anonymous Coward · · Score: 5, Insightful

    Man with a plan finally sees the fruits of his efforts after several years

  2. Accidental? by subk · · Score: 5, Insightful

    Sure sounds to me like he had a plan, having spent almost $20K of his own money to win the contest.

    --
    Now, if you'll excuse me, I have backups to corrupt.
    1. Re:Accidental? by Darinbob · · Score: 4, Funny

      Well frankly, I'm a bit pissed.

    2. Re:Accidental? by subk · · Score: 5, Insightful

      What about the other guy who spent $19k and didn't win shit?

      Put the pipe down, AC. It wasn't $18,000 worth of lottery tickets, the winner was chosen based on performance (amount of referrals).. $18,000 was the cost of implementing his strategy. Which happened to be the best one. If someone else spent $19,000 on a less successful strategy, well that's the way the cookie crumbles.

      You can call the boosted post-acquisition Jet.com stock value a windfall, but I find no reasonable way of calling it an "accident".

      --
      Now, if you'll excuse me, I have backups to corrupt.
  3. Dividends, a share of profit (just like Walmart) by raymorris · · Score: 3, Informative

    He owns the same thing Walmart owns, though a smaller amount. Walmart thinks their portion is worth over $3 billion, so no the shares probably aren't worthless.

    If the company is a) making money and b) not re-investing all of the profit go growth, they'll pay out the extra profit to shareholders as dividends. He'll get his portion of the dividends (profit).

    If the company is growing quickly, and therefore reinvesting all profit, his holding increases in value as the company gets bigger, because eventually when it stops growing fast it'll be a bigger company paying bigger dividends.

    If someone else wants those future dividends, they can get them by buying the stock from him today, in a private sale. Just because the stock isn't publicly traded doesn't mean it can't be privately traded.

    The benefits of being publicly traded would just be that he wouldn't need to take the time to find a buyer, and he could more easily see how much the stock is selling for on any given day.