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macrocephalopod

@macrocephalopod

Paul Allen, Vice President M&A, Pierce & Pierce (Sie/Hir) | Vegan | Silence is Violence | Women’s Rights Are Human Rights | ACAB (Assigned Cephalopod At Birth)

Joined December 2020

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    macrocephalopod‏ @macrocephalopod 28 Jul 2021

    macrocephalopod Retweeted Christopher Bloomstran

    Isn’t this how it normally works? The earlier investors bought in at a lower valuation so they got more stock for their cash, new investors are buying at a higher valuation so they get less stock. That’s not “dilution”.https://twitter.com/ChrisBloomstran/status/1420155140787560454 …

    macrocephalopod added,

    Christopher Bloomstran @ChrisBloomstran
    The expected $2.3B brought to the party by new shareholders represents almost 30% of all of capital raised since 2013, including proceeds raised in the offering. For their money these new "investors" will only own 7% of the company and far less voting rights. Dilution, baby. 4/
    Show this thread
    12:53 AM - 28 Jul 2021
    • 1 Retweet
    • 40 Likes
    • 𝔹ada𝔹ingCapital chris Cowboy Capital David Dubbert GoodTogo Mr. Sokrates
    4 replies 1 retweet 40 likes
      1. New conversation
      2. macrocephalopod‏ @macrocephalopod 28 Jul 2021

        macrocephalopod Retweeted Christopher Bloomstran

        Gee if only there was some explanation of why investors were willing to pay more for RH stock over the last two years. Something linked to the company fundamentals, maybe. Sadly I cannot think of anything.https://twitter.com/ChrisBloomstran/status/1420155141936852994 …

        macrocephalopod added,

        Christopher Bloomstran @ChrisBloomstran
        Including proceeds from the IPO, the VAST MAJORITY of capital will have been raised just in the past two years, mostly 2021. Reread the breakdown of how much capital the IPO buyers are investing and what percent of the company they will own. This makes SPACs look non-dilutive. 5/
        Show this thread
        1 reply 0 retweets 13 likes
        Show this thread
      3. macrocephalopod‏ @macrocephalopod 28 Jul 2021

        macrocephalopod Retweeted Christopher Bloomstran

        I wonder if there was anything happening in Jan/Feb 2021 that meant RH needed to raise a lot of cash quickly, leading to attractive terms for investors who could move fast? Hmm, no, I can’t think of anything.https://twitter.com/ChrisBloomstran/status/1420155150325403649 …

        macrocephalopod added,

        Christopher Bloomstran @ChrisBloomstran
        The converts were sold in February 2021, not bad for 5 months of ownership. If the IPO is wildly oversubscribed and prices north of $55 per share, the option holders get in at no higher than $38.29. The only way the converts were anything but free money was if no IPO ensued. 12/
        Show this thread
        1 reply 0 retweets 16 likes
        Show this thread
      4. macrocephalopod‏ @macrocephalopod 28 Jul 2021

        I can’t be bothered to read the rest of the thread, obviously a hack job by someone with a chip on their shoulder. Shame, I’ve liked some of Bloomstran’s other stuff!

        3 replies 0 retweets 16 likes
        Show this thread
      5. End of conversation
      1. New conversation
      2. londinburgh‏ @londinburgh 28 Jul 2021
        Replying to @macrocephalopod

        Aren't the people whe previously owned 100% of the company but will now own 93% the ones getting diluted?

        1 reply 0 retweets 0 likes
      3. Saang Lee (이상선)‏ @saanglee 28 Jul 2021
        Replying to @londinburgh @macrocephalopod

        But at a higher valuation. Early investor who buys 20% of a $1mm company at Series A doesn't expect to own 20% of the company if it IPOs after multiple seed rounds at a valuation of $10bn

        0 replies 0 retweets 0 likes
      4. End of conversation
      1. New conversation
      2. Saang Lee (이상선)‏ @saanglee 28 Jul 2021
        Replying to @macrocephalopod

        Think the man is confusing dilution and buying late-round at a higher valuation. Kinda unforgiveable for someone who has 50k followers and has "Read a 10-k" in his profile.

        1 reply 0 retweets 8 likes
      3. Saang Lee (이상선)‏ @saanglee 28 Jul 2021
        Replying to @saanglee @macrocephalopod

        Similar thought process would be: AAPL IPO'ed at a valuation of approximately $1.5 bn. $500mm would've bought 1/3 of the company. $500mm today only buys 0.02% Dilution!

        0 replies 0 retweets 7 likes
      4. End of conversation

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