Washington Is Killing Silicon Valley

Post by fallentimes » Mon, Dec 22, 2008, 6:40 PM UTC

ksvs wrote: post #30

beastman82 wrote: post #8

This article is heavily biased, makes ridiculously exaggerated claims, and bends statistics to its will. The computer boom came about because of capital gains tax cuts, huh? What a joke.

I suspect capital gains cuts did help. Founders are influenced by colleagues who've done startups, and what they see is the after-tax returns. And certainly big investors are influenced by tax rates on each class of investment.

Post by fallentimes » Mon, Dec 22, 2008, 6:42 PM UTC

ksvs wrote: post #29

tokenadult wrote: post #12

I always like international comparisons as a reality check on discussion of policy in the United States. Are countries without regulations like Sarbanes-Oxley enjoying a boom in entrepreneurial start-ups? Where?

China

Post by fallentimes » Mon, Dec 22, 2008, 6:45 PM UTC

Retric wrote: post #22

ohhmaagawd wrote: post #4

Earlier quoted context omitted.

I know a CEO of an Internet company that planned on doing an IPO in 2008. Of course the economy tanked so it's not happening. He told me that SOX required the company to have auditing/traceability and controls for everything. This meant they quit using any software as a service applications, they shut down IM, they have to keep track of everything on every machine, banned a whole list of applications that would inter…

IPO's are for large profitable companies who want to add liquidity. There is a huge pool of companies and people that invest billions in companies without an IPO, but there is a lot of laws setup to protect small investors. Anyway, there is a lot of overhead to going public, but if you want liquidity without selling then you need transparency or some company's are going to do huge scams. PS: There are IM clients that…

Post by nostrademons » Mon, Dec 22, 2008, 6:50 PM UTC

fallentimes wrote: post #46

pg wrote: post #27

Earlier quoted context omitted.

SOX hasn't killed the IPO, it's just made the hurdle higher and that's ok. Actually it has. It introduced a qualitative change in liability for corporate executives. Selling now has way, way less downside. The reason that's not "ok" is that a higher hurdle doesn't merely cause companies to wait before IPOing. They get bought instead. Result: no new public companies.

Or they issue dividends :). What's wrong with having fewer public companies?

Post by fallentimes » Mon, Dec 22, 2008, 6:52 PM UTC

nostrademons wrote: post #57

fallentimes wrote: post #46

Earlier quoted context omitted.

Or they issue dividends :). What's wrong with having fewer public companies?

Concentration of wealth and less efficient capital markets. There's really nothing wrong with it from most entrepreneurs' POV: they build something people want, they get paid for it. The problems occur at the margins: the businesses that could be started with enough outside capital but can't be bootstrapped off initial cash flows, or the small investors that are perfectly capable of doing due diligence on companies b…