Square stock drops 10%, is now less than IPO price • Hacker News Board

Re: Square stock drops 10%, is now less than IPO price

#111

Post by ccarter84 » Wed, Jan 20, 2016, 9:13 PM UTC

rdl wrote: post #79

boomzilla wrote: post #19

Earlier quoted context omitted.

Well, for some people, myself included, the not-going-so-well recent IPOs (Square, Box, etc.) would help deflate the pressure on housing prices in SF/BA. I feel for the workers at these company, but it's becoming impossible to raise a family here when the rent/mortgage is creeping up to more than half of most people's salary.

On the rent front, I doubt it -- salaries are just increasing to match. All-cash comp in the 300-500k range is surprisingly common (at least for 10+ year experience people in hot fields); add any luck on equity, and 2 incomes, and you can afford SF rents as they stand. Being able to reliably get a $300k/yr cash salary (salary+bonus, but still cash) seems more related to absurd rents than 10% of people getting huge eq…

Jeesh, 500k? Guess I'm in the wrong industry....

Re: Square stock drops 10%, is now less than IPO price

#112

Post by avn2109 » Wed, Jan 20, 2016, 9:21 PM UTC

djrogers wrote: post #68

bunderbunder wrote: post #52

Earlier quoted context omitted.

Especially so for an investment like housing, where rapid growth due to a shift in the popularity of your neighborhood is about the only reliable way for your "investment" to fare much better than sticking money under the mattress would. Sorry for the barb, but that meme (your house as an investment) really bothers me, because it has the potential to do a lot of damage. It's like penny stocks. Sure you can make money…

>rapid growth due to a shift in the popularity of your neighborhood is about the only reliable way for your "investment" to fare much better than sticking money under the mattress would Pretty shortsighted view there, and demonstrably wrong. Historically housing prices have always risen faster than the rate of inflation - both in 'popular'neighborhoods and elsewhere. Take almost any 10 year period of time and you'd b…

Is this true in all countries, or just the ones (like my country, the USA) where the real estate market is rigged by various government/incumbent entities?

Re: Square stock drops 10%, is now less than IPO price

#113

Post by geofft » Wed, Jan 20, 2016, 9:37 PM UTC

aaroninsf wrote: post #46

boomzilla wrote: post #19

Earlier quoted context omitted.

Well, for some people, myself included, the not-going-so-well recent IPOs (Square, Box, etc.) would help deflate the pressure on housing prices in SF/BA. I feel for the workers at these company, but it's becoming impossible to raise a family here when the rent/mortgage is creeping up to more than half of most people's salary.

Preach, sibling! My wife and I have put in more than 20 unsuccessful offers attempting to stay in our unfortunately popular neighborhood in the last two years. We have been chasing the affordability train for some years now, our increasing bids never getting ahead of the frenzy... (today, it seems we're at peak market and it'd be foolhardy to buy perhaps...) NB: we don't just 'move further out' not only because of 20…

Yeah, the way that the public school district system happens to interacts with housing markets is a remarkably powerful way of impeding class mobility. If your family already has a home in a well-funded school district, or if you can afford to move there, you can do very high return-on-investment things for your children. (Or, as you mentioned, if you can afford a private school.) And moving your home is a market with very long timescales.

Note that I am not saying that the school district system is somehow intrinsically morally bad, or that I know of a better alternative to it, just that it has this unfortunate result if you think class mobility is a good thing.

Re: Square stock drops 10%, is now less than IPO price

#114

Post by ralphael » Wed, Jan 20, 2016, 10:04 PM UTC

cm2012 wrote: post #103

rdl wrote: post #79

Earlier quoted context omitted.

On the rent front, I doubt it -- salaries are just increasing to match. All-cash comp in the 300-500k range is surprisingly common (at least for 10+ year experience people in hot fields); add any luck on equity, and 2 incomes, and you can afford SF rents as they stand. Being able to reliably get a $300k/yr cash salary (salary+bonus, but still cash) seems more related to absurd rents than 10% of people getting huge eq…

Median household income in SF is 77k, just FYI. Only 16% of SF households make over $200k (this includes 2 earner households, which is probably most of these). This doesn't negate anything in your comment, just adds a little bit.

I think this adds some necessary context to the previous "300-500K" comment.

Re: Square stock drops 10%, is now less than IPO price

#115

Post by rdl » Wed, Jan 20, 2016, 10:24 PM UTC

ralphael wrote: post #114

cm2012 wrote: post #103

Earlier quoted context omitted.

Median household income in SF is 77k, just FYI. Only 16% of SF households make over $200k (this includes 2 earner households, which is probably most of these). This doesn't negate anything in your comment, just adds a little bit.

I think this adds some necessary context to the previous "300-500K" comment.

Yeah, I meant scoped within peak-earning-tech-people.

Re: Square stock drops 10%, is now less than IPO price

#116

Post by amckenna » Wed, Jan 20, 2016, 10:25 PM UTC

gtrubetskoy wrote: post #13

All the food trucks, street and market vendors, estate and yard sales, handymen, etc I see accept credit cards using Square. If they figure out how to hang on to this market and grow as these little vendors grow then they're in good shape. Being down 10% when the Dow is down 400+ points for days on is not unusual. The big question is - who is Square competing with.

They are competing with the big unseen giants like First Data (https://en.wikipedia.org/wiki/First_Data) who owns clover. Square has a small part of the pie. They may be used by food trucks, small vendors, and people at the local farmers market but where the real money is coming in there are established players already.

Re: Square stock drops 10%, is now less than IPO price

#117

Post by smileysteve » Thu, Jan 21, 2016, 12:57 AM UTC

aneesh wrote: post #106

smileysteve wrote: post #40

Earlier quoted context omitted.

Mostly if we're discussing how equity compensation might not be the best option. Or how preferred investors and founders took what they could from the workers (in response to "refragmentation"). The Square IPO was less than employees who started after their last round and preferences made it even worse, meaning even though there is a liquidity event, employees who took options are out. With this significant drop, oth…

How did preferences make it worse? Generally, preferred shares convert to common in the event of an IPO, so preferences are discarded.

> With Square, investors were guaranteed a 20 percent premium on their investment, which would be worth $18.56 a share, meaning Square had to issue more shares to those investors, further devaluing the stock owned by employees.

http://www.bloomberg.com/news/articles/2015-11-19/square-emp...

Re: Square stock drops 10%, is now less than IPO price

#118

Post by bunderbunder » Fri, Jan 22, 2016, 12:27 AM UTC

djrogers wrote: post #68

bunderbunder wrote: post #52

Earlier quoted context omitted.

Especially so for an investment like housing, where rapid growth due to a shift in the popularity of your neighborhood is about the only reliable way for your "investment" to fare much better than sticking money under the mattress would. Sorry for the barb, but that meme (your house as an investment) really bothers me, because it has the potential to do a lot of damage. It's like penny stocks. Sure you can make money…

>rapid growth due to a shift in the popularity of your neighborhood is about the only reliable way for your "investment" to fare much better than sticking money under the mattress would Pretty shortsighted view there, and demonstrably wrong. Historically housing prices have always risen faster than the rate of inflation - both in 'popular'neighborhoods and elsewhere. Take almost any 10 year period of time and you'd b…

Yes, but if you're looking at them as an investment then you need to look at the overall picture. Just looking at prices over time is interesting, but it doesn't give the financial picture from the perspective of a homeowner because it ignores taxes, maintenance and repairs. Once all that's factored in the picture tends to get a lot less rosy.

For example, over the past 25 years the average price of a US home has grown by about 14% in real terms. I'm too lazy to calculate out what that would be as an annual percentage rate, but it's definitely lower than the average US property tax rate, which I believe is a smidge under 1%. So already, even without considering other expenses, houses tend to be gradual money losers on average.