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Red Hat IPO Surprise
An anonymous told us that they recieved a little
surprise in their inbox from Red Hat today: The NC boys
have reserved a chunk of shares to be purchased on E*Trade by
contributors to the open source comunity before the
masses get their chance to super inflate them. Very cool
on RHs part (even tho I didn't seem to make the cut *sniffle* :)
A few days ago everyone was being real paranoid about how Redhat would now have to answer to its stockholders. "What if Microsoft buys a stake?!" came the bellows. So what does Redhat do? They dump a ton of shares back into the Linux/OSS community. Everyone has focused on how this is free money if you sell out early, but it also gives you partial control of Redhat if you stay. So now Microsoft might own a piece, but so will Debian. And we all know the kind of amoral money-grubbers Debian attracts...
But this is wrong too? So y'all don't want he money coming from outside, because that biases RHAT away from the community, but it can't from inside either, because that biases the community towards RHAT. So where can the money come from? Is there anything Red Hat can do that isn't sinister and underhanded?
Yeah, I'd hate to get mail like that.
For all of you that think this is spam think again this is a GREAT offer. Why is this great? Well simply put this is an offer to get in on the ground floor price before it shoots through the ceiling. By the end of the day the price will more then likely be triple or more the initial price and that is quite a return on an investment. If you sell at the end of the day it's quite profitable.
Admittedly some do not have the $$ to open an E*Trade account and partake but those who can it is an excellent offer. All I can say is that Red Hat did have a good idea here since it is an excellent offer (whether you like the company or not) to make some $$ quite easily and with virtually no risk. No one says you *HAVE* to hang on to the shares at the end of the day (or week) they'll be worth quite a bit more and make you a nice profit.
I only wish that I'd received an email about this however a lot of my work is not high profile or where they would have heard of me. For the developers overseas all I can surmise is that RedHat did it in this way by email to limit the number of offers to just those developing and not to where the average person could get the info and take advantage of it. Why all the Debian developers? Simple they probably needed a quick and easy way to get the info out or it would be useless to waste a lot of people's time just looking for people that would be interested.
This is in a way them saying thank you to the developers by letting them make some $$ off of their IPO whether they like the company or not.
Personally, I think this is a great reward. First, it's not spam--If you were sent a username and password for an online trading account worth a million bucks unsolicited in the e-mail (with a reason and your name attached) would you turn it down? No. You would be jealous of the guy next to you if he got that account though. It's also very much in the "directed shares" category. Who made huge chunks of the product they sell, the community, so who are they trying to reward? The community. They can't get everybody (so don't bitch if you didn't get e-mailed) but they seem to have tried to hit a bunch. I've sent in patches to various packages I've worked with, and I'm not pissed that I didn't get e-mailed, but who cares, it's the thought that counts. In addition, stuff like this usually amounts to 100 shares a person, and if you have to open an account at etrade at $2000 and it opens at 20, then you just spend all the $ anyway, so don't bitch about the $$.
Quit your bitching!!!! I can't believe you're calling redhat spammers... Sure they sent out emails to many people, but they are doing these people a favor. They are not getting any personal gain out of it.
Here's what happens:
1. Red Hat emails a bunch of developers to tell them about their IPO and how they can get in early.
2. Developer chooses to open an etrade account (initial $1000 DEPOSIT, not a fee, you can get your money back by closing the account)
3. Red Hat's IPO happens. The price will (probably 99.9% chance) shoot up way above the initial offering, and then eventually drop off a little (or possibly alot).
4. Developer sells off stock at much higher price than he bought it for and makes lots of money, or chooses to hold on to it expecting it to climb higher sometime in the future.
Hmmm, who wins at this???? Well, the developer makes some money (looks like a good way for RedHat to give a little extra thanks back to the Open Source community), and etrade gets 29.90 for executing the trades for you (BFD, you just made a bunch of cash). Red Hat doesn't really gain anything out of it except maybe a short-lived bias towards their distribution.
Red Hat doesn't necessarily make the best distribution, but they definitely don't make the worst. They've had to put up with a lot of shit over the last few months because many people in the Linux community seem to adopt the idea that making money is evil and Red Hat is turning into Microsoft. Just because they try to turn a buck doesn't make them evil. Suse made more money last quarter than RedHat and they don't seem be criticized as much. Quit your complaining about this and take it for what it is... a simple thank you from Red Hat to the developers of open source software.
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I've seen many postings on both sides of an apperent debate. Some people claim that this is some kind of underhanded move by the people at etrade. Others would sugest that this shows how RedHat cares about its customers. One person likened it to RedHat throwing money in our faces. I say to all of you, "Calm It!"
Now, a few things. First the way IPO's work is like this. The portion of the company to be sold publicly is given to one main (in this case two) brokers. They in turn sell the stock at a price determined jointly by the broker, the company, and to some extend SEC rules. The borkers sell a portion to "friends and family" of the company having the IPO, a portion to the brokers customers, and a large part to other brokers. The other brokers sell some to their customers and put some into mutual funds etc. It is the small portion that goes to the brokers customers that apears to be in dispute.
It is not uncommon for this to be mostly sold to the winners of a lottery; however, some of this stock can be given to people in the industry. In the case of RedHat there just hapens to be a lot of people in the industry.
Yes, ETrade can require you to have an acount (they sell it to their customers remember). This creates competion and is why everyone wants to sponsor IPOs.
If no one buys the stock, Goldman Sachs has to buy it. They get the $96m either way.
Red Hat Software is offering this to those people that wrote code which is something that represents a contribution to the body of software that makes up the product that they sell.
That represents value returned for value contributed.
If your only "participation" is in having bought a box from them, then you received your reward in the form of that box.
If your only "participation" is in reading Slashdot, then I see no connection, no value, and no reason for them to give you anything.
If you're not part of the solution, you're part of the precipitate.
Certainly some interesting responses to all of this. Personally, I think that this was a very nice gesture on the part of RedHat. But can you image what would have happened if CmdrTaco had decided to go public with a /. IPO instead of selling to Andover?
/. user accounts first dibs at the IPO; unfortunately, he announces this by a mass e-mailing. This triggers a Jon Katz story about /. spam, which results in a heated /. discussion about /. spam, which results in a Jon Katz story about the discussion about /. spam.
/. effect. In Rob's filing with the SEC after the IPO, he sheepishly has to report that the largest shareholder is someone named Anonymous Coward.
/. poll: I own 1) 0-10 shares, 2) 10-100, 3) 300-1000, 4) 954+, 5) JarJar sucks. Unfortunately, someone inadvertently comments about the right to own stock. You know where this eventually leads to.
Rob generously offers
eTrade goes down under the immense
This is followed by
Moderation points are partly determined by the number of shares you own. This proves disastrous as MEEPT posts start at a +5.
If I decided to email you about some investment opportunity, would you consider that spam too?
Content does not define what's spam.
According to you. Spam is unsolicited *advertising*, by my definition.
Where do you draw the line?
If it was sent to a list of people who did not solicit the mail, it is spam. No exceptions.
Geez, that's pretty tough. I just sent a mail to 10 people I know at university, and I didn't ask them first. And earlier today I sent a mail to a list (of 2) Slashdot posters, and I sure as hell didn't ask them first.
If I were to suck a list of Linux kernel developers and mail them all saying `here, have a free Quad PII Xeon box, to help with your development work', would that be spam? If I were to mail a list of MPs in the UK telling them that key escrow was stupid and shouldn't go ahead (perhaps put slightly more rationally, and with arguments), would that be spam? You really have to clean up your definition a little. IMVVHO.
People abuse the word spam.
They do indeed.
And they misdefine it, too.