This is gonna be a big one. Valuation of $100 billion is possible
As long as it doesn’t do a Lyft
Which there’s a good chance of imo
Pretty incredible for a company that spends a lot of time trying to deny that the people who work for it work for it!
Only loosely familiar with Lyft as not seen one in the flesh
What did they get wrong?
Over confident valuation I think is the nice way to put it
I think Lyft should have pursued international expansion outside of North America before IPO.
I find myself using them a lot more than Uber when I’m in the US. I genuinely find that they have a better service and competitive rates.
But Uber are in far more places.
I heavily dislike the ethics that Uber and any “gig economy” service so personally I hope Ubers’ IPO tanks itself into the ground
Agreed. Call me risk-averse, but they seem overvalued to me. That they’re still in the red and don’t expect to be out of it for a couple of years yet is a concern.
Early investors exiting at this point will probably be the biggest winners, at least in the short to medium term. Longer term, if Uber don’t run out of money and if they successfully turn a profit, then that’ll be the point to get in on their shares. But, lot of ‘ifs’, and you’d have to be lucky with your timing.
It remains to be seen what will happen come the day when Uber have to price their services realistically instead of at a loss-leading ‘corner the market’ rate. Do they have a big enough captive market who can and will carry on using them regardless? Or will people get turned off and look for other solutions instead?
Amazon aside, can anyone name a modern tech stock that hasn’t tanked to some degree or other after IPO?
We counting Tesla?
Uber’s best chance is people saw what happened to Lyft and not pile in with the expectation of massive returns
The Pinterest IPO is another I personally would avoid like the plague
When a topic of a company going for IPO comes up it always reminds me that I have no idea really what that means. Who decides how much it’s worth, and how?
Don’t use them often, but funnily enough I missed my last train last night and used one. It was ace.
Step 1: Launch website that hosts photos
Step 2: ???
Step 3: Profit!
Interesting Podcast my sister sent me about Tech IPOs etc
Uber will be using the services of investment banks to value their business. There are all sorts of ways to do this (market share, turnover, profit, growth, competition, etc) but it won’t be easy because there isn’t anything quite like Uber.
Typically, they offer the shares for slightly less than the expected valuation. This means that investors expect to make a quick (if fairly small) profit, and that means that a company is usually able to sell all the shares it’s offering out.
The investment bank(s) then have a few tricks to stabilise the price - buying back shares to bump up the price, or offering more out to stop it rocketing.
If that all sounds a bit vague, it kind of is, but it’s in Uber’s interest to get the valuation right. Too low, and they give away the company for nothing. Too high, and no one buys it.
Ultimately, what is any company worth? It’s worth whatever people are willing to pay for it.
$45 a share, Lyfts were $72.
You have to multiply by the number of shares outstanding. Lyft is currently trading at $15bn, Uber at $82bn.
Well, that went about as well as I expected it would:
I expect them to keep going down, much like Lyft did. It makes no financial sense to get into Uber now, the only winners will be early investors who cash in their shares for a huge profit.
That’s good news the “gig economy” deserves to die a death.