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Confirmed: Walmart buys Jet.com for $3B in cash

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Re: Confirmed: Walmart buys Jet.com for $3B in cash

#131

Post by emagdnim2100 »

danielweber wrote: post #106
emagdnim2100 wrote: post #62

Earlier quoted context omitted.

This is a badly inaccurate description of how liquidation preferences work, both mechanically and also with respect to what's "market." First, it's exceptionally unusual to see anything more than a 1x liquidation preference (i.e. investors receive their initial investment back before anyone else gets paid) among well-funded companies. It's somewhat common to see a 6-10% interest rate added on top, but a 3x liquidatio…

> First, it's exceptionally unusual to see anything more than a 1x liquidation preference (i.e. investors receive their initial investment back before anyone else gets paid) among well-funded companies I've had options zero-out because the company, after investing with absolutely no preference given (which was part of what induced me to join), they took another round with preference funding at greater than 1x.

By "zero out," do you mean they were previously valuable and then dropped below their strike price after accounting for the > 1x preference? That sucks and I'm sorry it happened to you. It's still pretty unusual though.

Curious to hear - were any of the following factors in play: (i) the company was struggling to stay afloat, (ii) the company was located outside SF/NYC, (iii) the company had less-experienced founders?

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#132

Post by bjacokes »

dpeterson wrote: post #125

Walmart easily owes over 3 billion in taxes every year. There is a tiny almost non existent chance they will get a return as profit. However there is a 99.999% chance they get jet.com for free when they write it off as a complete loss in 2 years. If nothing else they get a valuable 3 letter domain name for nothing.

You're misunderstanding how taxes are calculated. If they could deduct the writeoff, they'd make back their marginal tax rate times the purchase price, so they'd still lose around $2B. (Similarly, when people deduct their mortgage interest, they don't get the mortgage "for free".)

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#133

Post by kilroy123 »

KenCochrane wrote: post #49

Jet.com ran a contest where they gave 100,000 shares as the top prize for the most signup referrals. This Guy is probably one happy guy right now. He spent $18k and the value of those stocks are probably worth in the millions. http://www.businessinsider.com/jet-insiders-referral-program...

OMG. What a smart move and an amazing investment. The guy probably saw 1,000 x return.

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#134

Post by noer »

ido wrote: post #98
toxican wrote: post #77

Earlier quoted context omitted.

I'll never understand remarks like that. The people who can put together something with similar functionality to Dropbox are by far in the minority. It's like having access to tons of scrap and be able to weld and dismissing metal bed frames because "I can do the same thing with some welding and scraps". Also the claim that it would eliminate my need for a USB drive was 100% on point.

"No wireless. Less space than a Nomad. Lame."[0] [0] https://slashdot.org/story/01/10/23/1816257/apple-releases-i...

Slightly off topic but: "Plus, you can use it as a portable disk. No "content protection". Yay!"

That was one of the best features of the original ipod line. Not only did was it a device to play music with, I could also use it as removable storage.

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#135

Post by shostack »

tommynicholas wrote: post #18
JonFish85 wrote: post #13

Earlier quoted context omitted.

Some scenarios (in no real particular order): - A Zynga-like order: give back unvested stock or you're fired - There were "hidden" bank loans / lines of credit that need to be paid back first. These may not be known to employees, but generally they are the first in line to be paid back. - If the cash acquisition is assuming they hit some earn-out targets, there's a very, very good chance that they won't get 100% of t…

#1 is the only one I can imagine (that was such a horrible situation at Zynga, I had family get hit), and given the founder, extremely unlikely. I understand why everyone wants a reason to be skeptical of this acquisition, but all signs point to a home run for everyone involved.

Is there anything employees can do to protect against such a horrible Zynga situation legally?

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#136

Post by MicroBerto »

tedmiston wrote: post #39

I really hope Walmart doesn't scrap the Jet Anywhere cash back program [0]. It seems not well known and somewhat controversial, but offers generous rates higher than everywhere else. For example, 4.8% from Expedia, 5.6% from Orbitz. Unlike every other cash back program they do not cap the amount for flights. JetCash is effectively real cash because many items are available cheaper than even from Walmart, Amazon, or C…

Meanwhile their own affiliate program offers something like a whopping 2%. No thanks, we'll send our traffic elsewhere...

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#137

Post by deegles »

rogerdpack wrote: post #92

I figured out what is going on here. Walmart thinks to themselves "we want to be like amazon, we want to be huge online" and then jet comes along and is something of an almost competitor to amazon, so corporate thinks "oh we should snap this up" but...my gut reaction here is this is going to be a terrible deal for walmart, what are they going to do, keep dumping $500M/yr for it at a loss or what? Pretty desperate, bu…

Would $500m/yr even be enough? I guess they could leverage their existing distribution network and stores...

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#139

Post by HillaryBriss »

rogerdpack wrote: post #92

I figured out what is going on here. Walmart thinks to themselves "we want to be like amazon, we want to be huge online" and then jet comes along and is something of an almost competitor to amazon, so corporate thinks "oh we should snap this up" but...my gut reaction here is this is going to be a terrible deal for walmart, what are they going to do, keep dumping $500M/yr for it at a loss or what? Pretty desperate, bu…

Here's an assessment of how Walmart was doing against Amazon -- from the year 2000:

... the case for Amazon getting crushed by Wal-Mart doesn't stand up when you do some side-by-side comparing of their Web sites. What's wrong with Walmart.com? Put simply, it settles for taking orders for the products people come looking for rather than enticing them to buy things they hadn't even thought of buying.

http://www.bloomberg.com/news/articles/2000-12-17/walmart-do...

It's 16 years later and Walmart still hasn't been able to compete with Amazon very effectively.

Re: Confirmed: Walmart buys Jet.com for $3B in cash

#140

Post by untog »

ido wrote: post #98
toxican wrote: post #77

Earlier quoted context omitted.

I'll never understand remarks like that. The people who can put together something with similar functionality to Dropbox are by far in the minority. It's like having access to tons of scrap and be able to weld and dismissing metal bed frames because "I can do the same thing with some welding and scraps". Also the claim that it would eliminate my need for a USB drive was 100% on point.

"No wireless. Less space than a Nomad. Lame."[0] [0] https://slashdot.org/story/01/10/23/1816257/apple-releases-i...

Everyone always digs that out, but the first iPod was kind of lame. I don't think it's unfair for someone to have pointed that out at the time. Especially when it's a hardware product - sure, the line is going to get better but you're not going to get a free upgrade to it.
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