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Red Hat IPO All Over the News
Most small company IPOs have at least a little disorganization and hype surrounding them, but Red Hat's was over the edge. We're not even going to try to sort out the claims and counter-claims, the complaints and counter-complaints, and all the rest, just point you to a selection of stories on the subject, not all of which agree 100% about exactly what happened, when it happened -- or to whom.
- Late IPO change left many red-faced at C|Net.
- Red Hat charges up 272 percent in debut from ZDNet
- Geeks Tip Their Caps to Red Hat at Wired News
- Share Price More Than Triples in Red Hat's Public Offering from the New York Times (free registration required to read)
- The Tech Investor column in the Aug. 12 Washington Post talks not only about Red Hat, but other recent IPOs. Good perspective piece.
- Red Hot (with a cute "hat" graphic) headlined Salon's take on the subject.
Single-share stock price is meaningless. MSFT would be trading at over $1000/share now if they hadn't split the stock numerous times.
More meaningful figures:
Microsoft Market Capitalization: $475 billion
Red Hat Market Capitalization: $5 billion
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
I really think we're all totally missing the big picture here..We're all getting pissed off about money. We really shouldn't be. When you step back and look at it, ignoring all the buzz and all the numbers, the money doesn't even matter. I mean, think about it..Did you get involved in Linux because you thought it would make you money? Or we doing all of this because you believe in the platform? For me, its the latter. I like Linux. Infact, I like it enough to devote some of my time to making it better.
What matters is, we're moving ahead. All of us. Not simply a bunch of guys who either got incredibly rich by pure luck or got rich by lying their way into an IPO. Sure, everybody loves the money..but getting rich isnt a necessary part (nor has it ever been a part) of the process of improving and strengthening Linux.
The fact that Red Hat's stock sits at $73/share right now isnt going to stop me from doing what I do, and making what I make. What the Linux community is doing right now is a necessary step on the way to dethroning Microsoft. Part of that means becoming a household name, which we're well on the way to doing. Somebody has to hit the beach first -- and for us, that happens to be Red Hat.
Were at the beginning of something big, not the end of something small.
Bowie
Founder, System 12 / PROPAGANDA
Bowie J. Poag
Bowie J. Poag
Can someone please tell me how the people who recieved The Letter were choosen? AFAIK, it looks like it was just Friends and Family of people working for Red Hat that got the chance to buy stock first... "800,000 IPO shares for "directors, officers, employees and friends of Red Hat," the filing said." (Hmm... Isn't this close to "insider trading?" Well... Sure wish I would have got "The Letter" ;-)
I got up at 7am PST (early for me, on flex time) to check to see if my "affinity shares" were allocated. Instead I see, on the ETRADE IPO center, the message about confirmation of interest. By a fluke, I get in and reconfirm in that short time window.
A little later, I also get the email saying that I should go and reconfirm by sending mail to ETRADE through their Account Services, and I take care of that as well.
A few hours later, I get an alert in my ETRADE account saying no allocation. Big disappointment, but I wasn't guaranteed anything from the beginning. I could live with that.
Then, things started getting interesting. Two hours after the no allocation message, I get a call from ETRADE asking me if I had reconfirmed, and if not to do so. At this point I thought that some person in ETRADE had a list of people to call for confirmation of interest, and was finishing the list, even though some of those people had already been passed over for allocation. So I asked her, and she said the allocation for affinity shares hadn't happened yet, and sounded confused about by "no allocation message." My hopes started to rise, but at that point, I thought the odds looked bad.
About eight PST last night, one of my coworkers, also an affinity shares type, got an ETRADE alert indicating that he needs to reconfirm via mail (he reconfirmed via the web form for non-affinity members, and had thought that sufficient).
I looked at my account, and shazam!, there was my allocation of shares at the IPO price!
In the end ETRADE came through, and the Red Hat price justifies the confusion along the way. However, ETRADE sure could have done a better job communicating what was going on. Had I decided to empty my account of cash after receiving the first bogus "no allocation" message, or to invest it elsewhere, I most likely would have received no allocation. (Although, given the way the ETRADE support lines have treated me so far, I imagine that they'd have fixed the mistake later). If Red Hat's price had plunged or skyrocketed, and I wouldn't have been able to make a decision about selling.
All in all, I'm happy with the way things worked out. But better communiction would have been nice.
The real gains--dwarfing even X number shares one might have bought--will come from the soaring demand for Linux skills. Sure, we all wish we could have invested tons in RedHat as "privileged investors", but in the years to come, the demand (and high fees) for Windows-to-Linux migration projects are going to be fantastic. I for one am pledging to myself to give back a bit, and donate a bit every year to the Free Software Foundation--without RMS's stubborn vision over the years, none of this would be happening today. Anyway, there's going to be plenty of lucre for everyone who is deeply into Linux. I just hope we hold onto our ideals as the greenbacks roll in. I think we'll be up to that challenge, though.