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Raspberry Pi Trading plans £370m+ stock market IPO

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Re: Raspberry Pi Trading plans £370m+ stock market IPO

#121

Earlier quoted context omitted.

>> I know nothing about an IPO of RPTL, other than what I've read in the media, but I can guarantee you that RPF will continue to be a non-profit charity, and continue with it's mission. Call me cynical, but you are absolutely clueless. Once shareholders are involved (especially public) the management will be changed. This lovely piece appeared about a week ago here on HN: https://reactionwheel.net/2021/11/your-board…

I know of very few cases in which privatization of something publicly run has benefitted the public. The argument "oh but the capital will allow all kinds of investments that will decrease the price in the long run" almost never holds up. Maybe it does in RPI's case, their innovation was supply chain based, after all. But my personal expectation, since a for profit company's interest is to extract as much profit add…

> I know of very few cases in which privatization of something publicly run has benefitted the public.

this has never been a "publicly" run company in the way you describe it. It has always been a private limited company.

The issue of concern here is that it is going from a private limited company where the shareholders are mostly to do with the rpi foundation, meaning that there is some chance that all the profit generated goes back to the foundation.

If its a public company, unless there are strict rules, it'll be open to shareholders buying control and changing the purpose of the trading company to something other than a tool to generate income for the foundation.

However thats not a given yet. I really hope that its something that is beneficial to the foundation.

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#122

Earlier quoted context omitted.

That was the original idea. However, as well as producing a board that was great for education and hobbyists, it turned out it was great for a whole range of applications, and the bulk orders started coming in from companies all over the world. The Foundation is funded on the sales of Raspberry Pi hardware, government contracts and charitable donations. More sales directly benefit the charity. This allows us to: - Ru…

Can you go into more detail on how the Foundation and the company are separated? I see a lot of doubt in this thread, and while some of it seems to come from a confusion of the two entities, the rest seems to acknowledge their separation, but doubt that it will protect the foundation in the long run. So, what would interest me would be how funding & staffing of the foundation works, if there are arrangements to ensur…

> I see a lot of doubt in this thread, and while some of it seems to come from a confusion of the two entities, the rest seems to acknowledge their separation, but doubt that it will protect the foundation in the long run.

There are two[1] companies registered, the foundation, which is the oldest, and the trading company.

From what I can see the foundation appear to get a significant portion of the profits from the trading company: https://find-and-update.company-information.service.gov.uk/c...

so long as that continues, then everything will be fine.

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#123

Earlier quoted context omitted.

Can you go into more detail on how the Foundation and the company are separated? I see a lot of doubt in this thread, and while some of it seems to come from a confusion of the two entities, the rest seems to acknowledge their separation, but doubt that it will protect the foundation in the long run. So, what would interest me would be how funding & staffing of the foundation works, if there are arrangements to ensur…

> I see a lot of doubt in this thread, and while some of it seems to come from a confusion of the two entities, the rest seems to acknowledge their separation, but doubt that it will protect the foundation in the long run. There are two[1] companies registered, the foundation, which is the oldest, and the trading company. From what I can see the foundation appear to get a significant portion of the profits from the t…

This setup can be used for good or bad. It can be used to for getting subsidies, it can also be used to funnel money from the non-profit to the for-profit, or to put everything which is for-profit on the for-profit, or to market itself non-profit while the main thing is the for-profit. There's examples of each of these, but I don't know whether it would apply here.

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#124

Earlier quoted context omitted.

> Even charities have to operate at a profit. Without this they would not have people, offices, marketing and the means to perform their stated charitable objectives. This is factually incorrect. Charities (at least in the UK) are legally prohibited from making a profit.

How do they pay for salaries, operating expenses, building rent, vehicle purchases, electricity, marketing, etc? They take a percentage of their income and use it to cover these expenses. Right? Well, this is semantics. A conventional business does exactly the same thing. They take a percentage of their income and use it to cover the cost of doing business. Laws for non-profits generally allow for such things. Which…

> How do they pay for salaries, operating expenses, building rent, vehicle purchases, electricity, marketing, etc?

> They take a percentage of their income and use it to cover these expenses. Right?

> Well, this is semantics. A conventional business does exactly the same thing. They take a percentage of their income and use it to cover the cost of doing business.

Yes, and in neither the case of the charity nor of the conventional business is that profit. That is operating costs, and gets deducted from revenue before tax is paid on what's left precisely because it is not profit.

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#125

Earlier quoted context omitted.

Simple example: A nonprofit wants to donate $600K to feed children. It will cost $400K in operating expenses to be able to do this. They need to generate $1MM in revenue and $400K in profits in order to be able to make use of $600K in support of their cause. Without this "profit" there is no nonprofit and no support for the cause. It is profit. One way to define profit is something like what you have left after deliv…

Profit (especially as people commonly use it) is the stuff left over after you pay overhead, not the overhead. Salaries of people doing the work are costs, not profits, and so on.

This is something I fundamentally disagree with. In the case of nonprofits, the profitable venture ends-up being positions that are highly paid and have huge benefits. People tend to have this idea of scrappy, idealistic, ramen-eating organizations when it comes to nonprofits. They are some of the richest companies in the land.

Here's an interesting article on nonprofit pay:

https://www.causeiq.com/insights/highest-paid-nonprofit-ceos...

From the article:

"The highest-paid nonprofit leaders — CEOs, Executive Directors, etc. — all earn at least $900k per year, and into the tens of millions for the largest of hospitals and health systems. While the highest-paid nonprofit CEOs are in healthcare and financial services, things get more interesting when we look at normal charities."

It's interesting that Financial institutions and categories such as "Promotion of Business" are listed in their survey. Nobody imagines an entity promoting the use of petroleum as a nonprofit. Most people think of churches and benevolent community organizations ("feed the X") as nonprofits. Nobody thinks hospitals, oil companies, credit unions, insurance, etc.

I call a lot of their overhead "profit" because, in this day and age, It feels obscene that an organization purporting to "help the X" would need to consume 40% of revenues, own/lease lavish buildings, etc. to deploy the capital they receive. How many on HN could setup a system that could administer, say, a hundred million dollars in donation while consuming just, say, 5% of that to run the show? My guess is many.

If you read through the list of nonprofit CEO salaries on that page you should get a good sense of where my perspective come from. This is profit. We call it something else. Fine. To me this is the individuals running the organization extracting profit from an organization under the cloak of a legal classification with a benevolent sounding name. Who doesn't have a soft spot for anyone who operates without making a profit? Right?

Well...let's look at CEO pay:

    Christus Health:  $13MM with a $5MM base pay
    Star One Credit Union:  $12MM
    NY Presbiterian:  $12MM
    Banner Health:  $11MM
    American Petroleum Institute:  $11MM
    Electric Power Research Institute:  $2.5MM
    Jazz at Lincoln Center:  $2.3MM  
        -The CEO takes 9% OF REVENUE as compensation!!!!
    University of Minnesota Foundation Investment Advisors:  $1.5MM
        - This represents 36% of revenue!
The point is, these are profitable pursuits. The profit goes to the people who work there, likely mostly to upper management. If they were scrappy idealistic not-for-profit organizations they would not be paying CEO's and the first layer or two under them tens of millions of dollars.

Another way to look at it:

Profit is what you use to run the organization. It's a percentage of revenue available for this purpose. It is important to understand the difference between gross and net profit.

I buy a blender from a wholesaler for $10 and sell it at retail for $20. My gross profit is $10. My net profit takes into account all the other costs, the ones that are required for the organization to exist. If that boils down to $5 per unit, the net profit is $5 per unit or, 25% of gross income.

In the case of an organization classified as a "nonprofit", things are different. They don't generally sell anything (well, hospitals and others do). They get a million dollars gross income from whatever activities. It could be donations. In the case of the company that promotes the use of petroleum, it is likely to be large membership fees paid by oil companies. For hospitals it is whatever they bill for services. Etc. That's their gross income. From that they have fixed costs in the form of buildings, leases, loans, etc. And now we come to what I am going to term the murky water portion: Salaries and other expenses. Million dollar compensation for executives and advisors. Lavish trips. In the case of the church my mother in law worked for, a couple of top-tier Mercedes Benz cars for the pastor and his underlings. Fully paid luxury vacations all over the world. Fully paid conferences at top tier resorts and hotels (think Waldorf Astoria), etc. Profit? I think so.

Anyhow, we can agree to disagree. I think the nonprofit category is deeply abused and a lot of people are getting incredibly rich through this mechanism. Frankly, had I understood this mechanism when I was a young man I probably would have figured out how to start some kind of an engineering nonprofit. I am being a bit sarcastic, of course, but I can imagine some kind of a scheme where someone creates a nicely profitable engineering consulting firm, pays themselves 40% of revenue and laughs all the way to the bank without paying taxes for decades. I am sure this already exists. That's why I call it profit. These are not poor little innocent organizations. They are some of the richest in the world. Let's start with the Vatican as a prime example.

EDIT:

To be clear, I am not saying all organizations legally classified as "nonprofit" are evil. What I am suggesting is that the classification is likely often abused for profit in various forms. One form would be lavish salaries and benefits (cars, trips, etc.). Another motive could be generating profit for allied or supporting organizations, a good example being oil companies financially supporting the American Petroleum Institute a "nonprofit" that likely generates billions for oil companies and whose top management is showered with multi-millions dollar salaries and benefits.

Here's another one: The NRA (National Rifle Association) is legally classified as a nonprofit organization. Technically, from an accounting perspective, I am sure it is. Does it exist for profit? Absolutely. Does anyone doubt that at all?

The category, the classification, is being abuse for profit disguised as something else. Not by all, yet likely by quite a few.

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#126

Earlier quoted context omitted.

Absolutely on point. My argument is simply that, as you put it, making more than you spend is a necessary element for any organization to exist and grow. In the case of a conventional business everyone calls this profit. Somehow, magically, in the case of "nonprofits" we don't. The term "nonprofit" is a misnomer that might be the reason for this distinction, at least in the US. The term implies the idea of zero profi…

Your definition of "profit" doesn't seem to match anyone else's. If an organisation spends what revenue it has on its own operations, that is not profit. You might not agree with the way that money is spent, but that does not change the technical definition of a well-understood and widely agreed accounting term.

Rather than repeat myself, I'll refer to a comment I just posted and then ask you a couple of questions:

https://news.ycombinator.com/item?id=29404841

Do you think the Vatican is profitable?

Do you think that a nonprofit that pays their CEO 36% --yes THIRTY SIX PERCENT-- of revenue is profitable?

Do you think that the American Petroleum Institute, which pays their CEO $11MM in salary (4.5% of revenue on $238MM in receipts) exists with a real non-profit objective despite what their balance sheet might say?

You see, we get lost in this legal "nonprofit" classification and fail to understand that a lot of these organizations exist for the profit (the enrichment) of either the individuals running them, associated commercial enterprises (oil companies) or both. If we refer to them as "X4132 organizations" (made-up name) we would have no emotional attachment or a mental model to go against what they actually do. When people hear "nonprofit" they think something like "feed the X" scrappy entities with idealistic workers and managers all eating ramen noodles to conserve every dime for their worthy cause. That is FAR from reality. Very far.

And that's why I tend to call it "profit". Yes, sure, this does not fit the technical definition of profit, but it is hard to argue that a CEO taking 5%, 10%, 30%, 40% of revenue isn't actually the profit element of the organization. I give the example of the lavish cars and trips for the pastor and management paid for by the church my mother in law used to work for. That's profit. We might classify it some other way, but it isn't charity.

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#127
post #83

Earlier quoted context omitted.

Pure communism as conceived in theory is not the same thing as the Soviet and Chinese applications which are really authoritarianism.

Communism is totalitarian by nature. It will always be evil and abhorrent

There's nothing totalitarian in communism by definition[1]. Marxism-Leninism and Maoisn certainly are very totalitarian implementations, but there are others.

`Communism (from Latin communis, 'common, universal') is a philosophical, social, political, and economic ideology and movement whose goal is the establishment of a communist society, namely a socioeconomic order structured upon the ideas of common ownership of the means of production and the absence of social classes, money, and the state. Communism is a specific, yet distinct, form of socialism. Communists agree on the withering away of the state but disagree on the means to this end, reflecting a distinction between a more libertarian approach of communization, revolutionary spontaneity, and workers' self-management, and a more vanguardist or Communist party-driven approach through the development of a constitutional socialist state.`

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#128

Earlier quoted context omitted.

Your definition of "profit" doesn't seem to match anyone else's. If an organisation spends what revenue it has on its own operations, that is not profit. You might not agree with the way that money is spent, but that does not change the technical definition of a well-understood and widely agreed accounting term.

Rather than repeat myself, I'll refer to a comment I just posted and then ask you a couple of questions: https://news.ycombinator.com/item?id=29404841 Do you think the Vatican is profitable? Do you think that a nonprofit that pays their CEO 36% --yes THIRTY SIX PERCENT-- of revenue is profitable? Do you think that the American Petroleum Institute, which pays their CEO $11MM in salary (4.5% of revenue on $238MM in rec…

> Do you think the Vatican is profitable?

No idea. I'd have to take a look at their accounts.

> Do you think that a nonprofit that pays their CEO 36% --yes THIRTY SIX PERCENT-- of revenue is profitable?

No idea. I'd have to take a look at their accounts.

> Do you think that the American Petroleum Institute, which pays their CEO $11MM in salary (4.5% of revenue on $238MM in receipts) exists with a real non-profit objective despite what their balance sheet might say?

No idea. I'd have to take a look at their accounts.

> Yes, sure, this does not fit the technical definition of profit,

It is the opposite of profit. It is what you structure if you want to reduce your profit so you don't get taxed.

> I give the example of the lavish cars and trips for the pastor and management paid for by the church my mother in law used to work for. That's profit.

No, it isn't. It might be embezzlement, from the sounds of it.

I get the point that you are trying to make, but doing so by redefining common terms and hoping anyone is going to take it seriously strikes me as remarkably unlikely to succeed. The word you are looking for is not "profit", it is "enrichment", as you say here. They are not the same. Words matter.

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#129
post #60

Earlier quoted context omitted.

Imo, it's a flaw in our model. If 'fighting them' failed, then, we should join them. Here, that would mean participation in the ipo, in the style of gamestop. Push the p/e ratio to something completely absurd. Maybe it'll fail as a result. (Thus begetting a libre office, response to an open office initiative.)

Hello, I think your account's ability to post and be seen is being interfered with, as all your comments are greyed as soon as you post, and I had to 'vouch' for this post in order to reply, thought you should know, because this was an otherwise insightful comment.

Lol, thank you very much for telling me. I find that I get shadow banned and outright banned on every social media site and forum. I genuinely don't understand why. It's usually for comments such as this one. (Shrug)

Re: Raspberry Pi Trading plans £370m+ stock market IPO

#130
post #127
post #83

Earlier quoted context omitted.

Communism is totalitarian by nature. It will always be evil and abhorrent

There's nothing totalitarian in communism by definition[1]. Marxism-Leninism and Maoisn certainly are very totalitarian implementations, but there are others. `Communism (from Latin communis, 'common, universal') is a philosophical, social, political, and economic ideology and movement whose goal is the establishment of a communist society, namely a socioeconomic order structured upon the ideas of common ownership of…

You cannot have a collectivist regulation of supply and demand without a totalitarian control of the production and distribution of everything. Totalitarianism is integral to the core of communism, it's the hinge point of it's entire function. Dogma which rejects that reality does not change it, and _every_ instance of it in real life backs up this simple reality.
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