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Square Prices Its IPO at $9, giving it a $2.7B valuation

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Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#61

Post by enra »

x0x0 wrote: post #55
isalmon wrote: post #47

Earlier quoted context omitted.

The stock options priced is based on the 409a valuation, not on what investors paid in the last round, so they might not be worthless.

what is a normal ratio between the two?

Depends on the stage. Early stages the difference can be 1000-10x. Later stages the difference is much less, 10-1x but usually by then companies start issuing RSU's not options.

RSU's are stock given with the current valuation (eg. you get 10,000 shares, which are worth of $1M with the current valuation). If the company IPO with that valuation, you get ($1M - taxes). If they IPO with less or more, you get less or more.

Difference is that with options you actually have to exercise (buy the stock) with the given strike price.

Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#62

Post by toomuchtodo »

theseatoms wrote: post #26
geoffwoo wrote: post #16

Earlier quoted context omitted.

Very low margin business. As a multiple of net revenue, it's at the high range of comparable payment processors.

And revenue growth prospects aren't all that high?

Not when you're competing against every other payment processor.

Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#63

Post by toomuchtodo »

jsprogrammer wrote: post #7
econner wrote: post #5

Why would they price it at such a low multiple of revenue? Massive liabilities or something?

No one feels like subsidizing more of Starbuck's' transaction costs?

Starbucks is almost done moving away from Square for CC processing.

Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#65

Post by exw »

econner wrote: post #5

Why would they price it at such a low multiple of revenue? Massive liabilities or something?

Great article by Bill Gurley that explains some of the factors that drive revenue multiples: http://abovethecrowd.com/2011/05/24/all-revenue-is-not-creat...

Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#67

Post by TazeTSchnitzel »

hn9780470248775 wrote: post #30
hn9780470248775 wrote: post #13

Earlier quoted context omitted.

Confusingly, my browser renders that symbol () as a... square.

Apparently Apple uses U+F8FF, part of the Unicode "Private Use Area", to represent its logo. It's not surprising that it fails to render on non-Apple platforms, given this warning in http://www.unicode.org/Public/MAPPINGS/VENDORS/APPLE/CORPCHA... : # The following (1) is for the Mac OS Roman encoding # (also used in Symbol & Croatian). # NOTE: The graphic image associated with the Apple logo character is # not author…

Well, by definition, the Private Use Area is for private use. An OS vendor can put whatever they like there, as can a user.

Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#68

Post by harryh »

JonFish85 wrote: post #48
guelo wrote: post #46

Earlier quoted context omitted.

They'd be smart to hand out some heavy cash bonuses to employees that have been dreaming about $20 per share for years.

Why? The investors get an exit, Jack can cash in his shares, and the general public can inherit the rest. In the near term there will probably be layoffs, as soon as Wall Street realizes that the company had no real direction or traction that can support a multi billion dollar valuation.

Jack can't cash his shares. At least not for a long time.

Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#69

Post by heydenberk »

Is anyone willing to give a contrarian take? I'll give it a shot: Square is an ambitious company with some great engineers, stellar UX and a giant total addressable market. Their business loans are interesting and could grow into something important. Square readers are a fashion accessory for hip businesses. No sooner would a coffee shop be seen without a Square reader and an Edison bulb than its yuppie hipsters patrons would be seen without a MacBook or an iPhone. That brand equity might really be worth something.

Re: Square Prices Its IPO at $9, giving it a $2.7B valuation

#70

Post by vskarine »

espitia wrote: post #64
msoad wrote: post #6

With rumors about  device to device payment talks[1], Square is in tough spot. [1] http://www.wsj.com/articles/apple-in-talks-with-u-s-banks-to...

Anyone have link without paywall? :-)

https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&c...
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