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Increase networth given by private companies
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zxektok megatron RJ: zxektok Post Rating: 1 + / - Total Posts: 140 Karma: 170 Joined: Mar 6, 2012 |
Posted on May 9, 2012 Currently if 2 companies both make 100million profit a dayPlayer A owns 100% of 1 company (private) and another player B owns 70% of a company (public) (dividends,shareholders, accountants and more stringent tax laws) although going public gives an immediate cash return - if both companies have the same $ then player B has more SCORE / NETWORTH because he has shares. Player B's average stock price is well above networth price X 5-20 Private companies value is always at base X 1 This also impacts player decisions based on if a player wants to be "successful" in the game - i.e top 10 player rankings then he/she would HAVE to go PUBLIC due to the networth increase of having millions of shares in that players portfolio. I dont see an advantage of keeping a company private if you are trying to stay competitive as a player. Hence why most players go public as soon as they can. I propose increase private company holder PLAYERS networth by 5 - 10 times base networth of the company that does not fluctuate. What do you guys think? Currently being private is a huge disadvantage i think for many reasons. So lets make it a have a purpose. |
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zxektok megatron RJ: zxektok Post Rating: 0 + / - Total Posts: 140 Karma: 170 Joined: Mar 6, 2012 |
Posted on May 10, 2012 yes and yes and noprivate companies -worth- are compared to that of a public one which data is readily available for people. Book value is compare to other companies "books" This seems hard to do in this game. My stated problem is that there is currently a huge difference in player score just buy owning shares. where as a player who owns a private company actually owns 100% shares but score only reflects the base. if the player sells 0.1% of the company - the share price will easily triple - valuing THE 99.9% of the company at triple what it was before - tripling that players score.... the score function is vastly onesided - and does not reflect real life. For example facebook is a privately owned. The companies are still valued - well above current sales data (networth) due to success and other companies in the business. The headhoncho could not sell 1% and triple-x10 the value of his remaining 49% to make him the asset richest man on the planet. It doesn't work like that |
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zxektok megatron RJ: zxektok Post Rating: 0 + / - Total Posts: 140 Karma: 170 Joined: Mar 6, 2012 |
Posted on May 10, 2012 just looked"post more than $1 billion in revenue during 2010. Recent firm values are said to exceed $40 billion, so in this case if it was this game - his private company would have a score 40 X his standard revenue worth but because its "private" this couldn't happen(in this game) <- in this game facebook would be valued at 40 times LESS until he sold a tiny percentage. thus the players score would be 40 times less - a big difference on owning less of a company..... EDIT: facebook has now posted its valuating at $95 billion... and new laws make going public harder for smaller companies. Thanks to the massive regulatory burden the country now places on public companies, it costs at least $5 million a year to be public (in the US). What small company in its right mind would want to pay that? Then, for another thing, there's the enormous hassle and legal risk. |
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Scott (Admin) RJ: Ratan Joyce CO: Ratan Joyce Post Rating: 0 + / - Total Posts: 1175 Karma: 5083 Joined: Jan 13, 2012 |
Posted on May 10, 2012 Thanks zxektok, I see your point:The headhoncho could not sell 1% and triple-x10 the value of his remaining 49% to make him the asset richest man on the planet. It doesn't work like that Yes, that would pose a serious problem even after the ask/bid correction, meaning perhaps market capitalization should not be used for player networth calculations at all? |
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Victoria Raverna RJ: Victoria Raverna CO: Victoria Raverna Post Rating: 0 + / - Total Posts: 107 Karma: 43 Joined: Apr 11, 2012 |
Posted on May 10, 2012 Problem with not using market capitalization in player networth calculation is that you're going to discourage people from investing in stock. This is going to cause liquidity problem with ask/bid without robo investors system. |
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zxektok megatron RJ: zxektok Post Rating: 0 + / - Total Posts: 140 Karma: 170 Joined: Mar 6, 2012 |
Posted on May 15, 2012 really people invest in stock because they see it as an investment/ a way to make money -not as a score boost when players sell the stock at a higher price - they can make million or billions or peanuts... it is a money making gamble (supposed to be) It would be interesting if Scott made market capitalization not be used for player networth calculations at all. I would like to see the outcomes on that. I am not sure what the fix is but its very skewed against private companies |
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