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cosmoray
Cosmoray Construction
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Posted - 2008.09.10 02:34:00 -
[1]
Now when people attempt to launch an IPO they tend to use Hexx's famous IPO template:
IPO Template
The template is excellent for stating your business plan before it gets 'critiqued' by the forum.
I think it is about time to add another caveat.
Expected Returns
An expression of how much you think the business will make. Most IPO's generally state this (so nothing really new).
Minimum Expected Returns
This is a level that the CEO states that he EXPECTS make with his/her business plan.
The IPO will define that if the IPO underperforms (does not meet Minimum Expected Returns) for 'X' number of months (3, 6, other), a vote will be taken on whether to continue the business or liquidate.
This should stop IPO managers hanging on in vain when the business is clearly in trouble. The IPO manager can choose NOT to do the vote, but at that point the IPO pretty much becomes a scam.
Here's hoping to make the universe a better experience for investors
Discuss
(note: yes, everyone knows the reasons why I started this type of recommendation)
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Treelox
Amarr
Market Jihadist Revolutionary Party
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Posted - 2008.09.10 03:21:00 -
[2]
 Originally by: cosmoray
(note: yes, everyone knows the reasons why I started this type of recommendation)
The Market Jihadist Revolutionary Party, refuses to do a buy back of any shares at this time. We do not care if our ROI to our investors this year has been -0.5%, we will do what the hell we want as we want.
Thank you for your time.
--
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Hexxx
Minmatar
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Posted - 2008.09.10 21:30:00 -
[3]
Originally by: cosmoray
Now when people attempt to launch an IPO they tend to use Hexx's famous IPO template:
IPO Template
The template is excellent for stating your business plan before it gets 'critiqued' by the forum.
I think it is about time to add another caveat.
Expected Returns
An expression of how much you think the business will make. Most IPO's generally state this (so nothing really new).
Minimum Expected Returns
This is a level that the CEO states that he EXPECTS make with his/her business plan.
The IPO will define that if the IPO underperforms (does not meet Minimum Expected Returns) for 'X' number of months (3, 6, other), a vote will be taken on whether to continue the business or liquidate.
This should stop IPO managers hanging on in vain when the business is clearly in trouble. The IPO manager can choose NOT to do the vote, but at that point the IPO pretty much becomes a scam.
Here's hoping to make the universe a better experience for investors
Discuss
(note: yes, everyone knows the reasons why I started this type of recommendation)
Be careful....
I am firmly against shares having minimum returns, in other words, if a CEO knows that if he underperforms for x amount of months, he must liquidate....in such a case, that CEO may inflate his dividends. He may do this by promising a minimum dividend or simply being extra generous for a given month. This misrepresents the business. The only time a fixed return should ever be used is in a Bond. Shares should have variable returns, not minimum returns.
However, I would suggest the following;
In the Exit Strategy, a Corp should outline a review period or date. Every 3 months, or 6 months, it considers liquidating.
Why?
Nothing lasts forever. All businesses in EVE will end one day. All of them. There are no exceptions.
Proactively looking at the market, the business, and the will of the management (be it a single person or a group) is good for investors and good for the company. Maybe investors should be the ones to push for this, I'm not really sure.
Good discussion though. I look forward to continueing it.
Chairman of the Board of Directors | www.eve-bank.net
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cosmoray
Cosmoray Construction
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Posted - 2008.09.10 22:27:00 -
[4]
I think the important thing here is to keep the shareholders active in the running of the company, after all they own it!
Hexx's suggestion is good. A term limit for review is fine, say 6 months.
If the company is well run and pays good divs and there is a secondary market for the shares no one will vote for closure.
If the divs are poor, and business isn't working, well at least the shareholders have a say.
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Block Ukx
Block Ships and Ammunitions
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Posted - 2008.09.11 13:55:00 -
[5]
It seems to me that you are attempting to shift the investorsÆ risk to the CEO and trying to mold all public offerings as short-term bond offerings.
Investing in the stock market is risky, and if you arenÆt aware that you can lose all your money then you should not invest at all. Investors need to assume responsibility for their own choices. If they believe the business is failing then SELL the stock. We all have been pushing for a secondary market, but very few investors actively trade shares in the current exchanges.
Shareholders should stay away in the running of a company and need to be active managing their own portfolio. They have the power to buy/sell their shares at their own accord. Having shareholders running a company is like going to a plumber for x-rays. If you as a shareholder believe you should have a said in the running of a company then join the Board of Directors, if there is one.
Investors must read the IPO prospectus before investing. Contact the CEO directly with your questions, and if you are unhappy with the CEO, then donÆt invest.
The duration of the business should be specified in the prospectus. Typically, stocks are perpetual while bonds have a specified maturity date. If you donÆt like the perpetual aspect of stocks, then invest in bonds. If you donÆt like the profit sharing method of stocks, then invest in bonds with an specific rate of returns.
BSAC Mineral Market Manipulation (MinMa) Information Desk |
cosmoray
Cosmoray Construction
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Posted - 2008.09.11 14:15:00 -
[6]
Fair point Block, but what do you suggest to do, if you own shares in a stock:
1. You can't sell
2. Has no buyback policy
3. Has close to zero divs
The CEO refuses to change business plans because of IPO statements made several years ago. Times change but the CEO is sitting behind technicalities to hold onto capital, what then?
Declare scam and write off your money?
This action and a few large IPO's failing because CEO's hang on too long and just leave game and stop managing the business is what has killed the secondary market.
The stock markets are basically dead.
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Shar Tegral
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Posted - 2008.09.11 14:53:00 -
[7]
Originally by: Block Ukx
They have the power to buy/sell their shares at their own accord. Having shareholders running a company is like going to a plumber for x-rays. If you as a shareholder believe you should have a said in the running of a company then join the Board of Directors, if there is one.
This is one of the failings of the share market in Eve. Once you hand over your money you are slave. Either to a CEO (for whatever defect or trait) or slave to whoever is going to buy you out. If anyone will buy you out. It makes investing a sure fire way of trading 1 isk to get .5 isk. If you are lucky that it is only a failing project and not outright scam. Seems there is little in between. And, if I remember correctly, it is ameliorating this disparity the sole purpose of this kind of brain storming. Not producing a sop to the investing fears for the new or uninitiated but maturing this market like it should be.
To Shar -verb:
1 - To say what you mean.
2 - To say what it means.
3 - To say something mean. |
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