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