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So now my company hit lvl 6..... Should I rush the IPO or hold?
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Weicong Sng RJ: Park Min Young CO: Psychotic Nutcase Post Rating: 1 + / - Total Posts: 59 Karma: 28 Joined: Apr 10, 2012 |
Posted on Apr 17, 2012 (Last edited on Apr 17, 2012) Well I'm really utterly clueless as to when and how to time my IPO.How should I launch it in some a way that is favorable to me and the company? |
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Josh Millard RJ: Tex Corman CO: J. Quaff Arabica Post Rating: 6 + / - Total Posts: 167 Karma: 231 Joined: Apr 3, 2012 |
Posted on Apr 17, 2012 (Last edited on Apr 17, 2012) Well, here's what's going to happen when you IPO:1. You'll put some percentage of the company on the market as publicly purchaseable shares. Default/minimum is 25% of your company's current net worth; if your company was worth $40M at the time of the IPO and you did that, you'd be issuing 10M shares of the company (of 50M total shares, 40M of which you continue to hold) to the public at $1/share. 2. You'll immediately get $10M in the company coffers for those ten million shares. The public stock will now be owned by robotic Econosia shareholders. 3. Players will almost certainly buy some of your stock from those skinflint Econosian nobodies, because, hey, buck a share? Your stock price will increase in value. 4. Your player (not company) net worth will jump up a bunch come midnight, as the value of all the shares of your stock you still hold multiplied by the current probably-a-good-bit-higher-than-$1/sh price of your stock will be added to that calculation. 5. You can cash in immediately on the raised price of your stock by selling some of your own shares. This is not dangerous unless you manage to sell so much that you no longer have a majority of the share in your company (because then you're set up for a hostile takeover and ouster from the firm!). 6. But you can also sit on your stock holdings in hopes that the price will continue to increase over the long haul, so that you can sell shares later for more return per share. So, go now or wait? It's largely a question of how much stock you want to put out on the market, how much of a percentage you want to retain, how much you expect your company's value to increase over time, etc. A larger net worth at the time of IPO means a larger number of shares you can issue while retaining the same control of the company, which means a larger immediate cash infusion from the IPO and also a larger chunk of shares you can later sell at higher market prices while STILL retaining control of the company. The details of the short and long game I'm sure someone who enjoys playing the market more than I do can elaborate on. But that's the basic set of experiences that come with the process. My short answer would be to maybe wait a bit to get a little larger, and to get some cash saved up and moved over to your player balance from the company balance if you intend to so anything outside of the actual business operations with that money on the short term, since once you IPO you can't do direct transfers from the company coffers to your bank account anymore. |
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Weicong Sng RJ: Park Min Young CO: Psychotic Nutcase Post Rating: 0 + / - Total Posts: 59 Karma: 28 Joined: Apr 10, 2012 |
Posted on Apr 17, 2012 Thanks alot for your long and detailed post, really learnt quite a lot. I guess I will wait for a while before IPOing then.
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Brent Goode RJ: BB Goode CO: BB Goode Post Rating: 0 + / - Total Posts: 506 Karma: 180 Joined: Apr 5, 2012 |
Posted on Apr 19, 2012 That was a great answer. I also learned a lot.
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Xbox Pants RJ: Xbox Pants Post Rating: 0 + / - Total Posts: 1 Karma: 10 Joined: Apr 20, 2012 |
Posted on Apr 20, 2012 Is it possible to issue more shares after the initial IPO, or, if not, are there any intents to add this feature?
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graham shearlaw RJ: Graham CO: Funk Post Rating: 0 + / - Total Posts: 48 Karma: 11 Joined: Apr 9, 2012 |
Posted on Apr 20, 2012 you can split the shares to make more of them.if i do a 2 for 1 split every stock holder will get two stock for every one that thay had befor the split. |
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Josh Millard RJ: Tex Corman CO: J. Quaff Arabica Post Rating: 0 + / - Total Posts: 167 Karma: 231 Joined: Apr 3, 2012 |
Posted on Apr 20, 2012 Your company can directly issue more shares after IPO, yes. There's "Issue More Stocks" line item in the HQ section of the City when you visit from a public company. This will of course lower your overall ownership stake in the company, since there will be more shares in play that you don't own.
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