Why SurveyMonkey is holding off on an IPO

#1

Post by alexconrad » Thu, Jan 17, 2013, 4:58 PM UTC

Why SurveyMonkey is holding off on an IPO
tech.fortune.cnn.com

Re: Why SurveyMonkey is holding off on an IPO

#2

Post by grzaks » Thu, Jan 17, 2013, 5:48 PM UTC

"And yet, SurveyMonkey [...] has two reasons for raising capital. One is to reward the investment firms, Spectrum Equity and Bain Capital, that bought the company just over four years ago, when it was about a fourth its current size. The other is the perennial tech-industry rationale for an IPO: so SurveyMonkey's employees can sell some of the stock that is a significant portion of their compensation."

Honestly, for me as an occasional stock investor that sounds like a serious warning signal. Why should I invest in a company that does IPO only for some people to do exits? (which was exactly the reason FB did IPO) Stock investors are looking for growth potential. It's just a conflict of interest.

Re: Why SurveyMonkey is holding off on an IPO

#3

Post by Retric » Thu, Jan 17, 2013, 6:05 PM UTC

grzaks wrote: post #2

"And yet, SurveyMonkey [...] has two reasons for raising capital. One is to reward the investment firms, Spectrum Equity and Bain Capital, that bought the company just over four years ago, when it was about a fourth its current size. The other is the perennial tech-industry rationale for an IPO: so SurveyMonkey's employees can sell some of the stock that is a significant portion of their compensation." Honestly, for…

Every time you buy stock someone else is selling it. That does not mean it's a bad buy, just that the seller has different priorities.

Re: Why SurveyMonkey is holding off on an IPO

#4

Post by sjg007 » Thu, Jan 17, 2013, 7:11 PM UTC

I am amazed they did so well. Good execution. I like the new building they are constructing in Palo Alto as well.

Re: Why SurveyMonkey is holding off on an IPO

#5

Post by rschmitty » Thu, Jan 17, 2013, 7:40 PM UTC

sjg007 wrote: post #4

I am amazed they did so well. Good execution. I like the new building they are constructing in Palo Alto as well.

I'm also amazed how well they are doing. Do they have some kinda online survey patent or do competitors just suck that much?

Re: Why SurveyMonkey is holding off on an IPO

#6

Post by crusso » Thu, Jan 17, 2013, 7:46 PM UTC

rschmitty wrote: post #5

sjg007 wrote: post #4

I am amazed they did so well. Good execution. I like the new building they are constructing in Palo Alto as well.

I'm also amazed how well they are doing. Do they have some kinda online survey patent or do competitors just suck that much?

Chalk me up as dumbfounded as well. How you build a business model upon something so simple, easy to replicate, and (to me) value-less is a mystery.

Re: Why SurveyMonkey is holding off on an IPO

#7

Post by neya » Thu, Jan 17, 2013, 8:02 PM UTC

rschmitty wrote: post #5

sjg007 wrote: post #4

I am amazed they did so well. Good execution. I like the new building they are constructing in Palo Alto as well.

I'm also amazed how well they are doing. Do they have some kinda online survey patent or do competitors just suck that much?

From what I see, they somehow managed to get some top notch clients using their product. I guess it's the level of professionalism their product projects for itself.

Re: Why SurveyMonkey is holding off on an IPO

#8

Post by jonknee » Thu, Jan 17, 2013, 8:40 PM UTC

crusso wrote: post #6

rschmitty wrote: post #5

Earlier quoted context omitted.

I'm also amazed how well they are doing. Do they have some kinda online survey patent or do competitors just suck that much?

Chalk me up as dumbfounded as well. How you build a business model upon something so simple, easy to replicate, and (to me) value-less is a mystery.

Why do you see user survey's as value-less? Being able to gather and analyze information from a group of people is a great value.

Re: Why SurveyMonkey is holding off on an IPO

#9

Post by jpdoctor » Thu, Jan 17, 2013, 8:55 PM UTC

grzaks wrote: post #2

"And yet, SurveyMonkey [...] has two reasons for raising capital. One is to reward the investment firms, Spectrum Equity and Bain Capital, that bought the company just over four years ago, when it was about a fourth its current size. The other is the perennial tech-industry rationale for an IPO: so SurveyMonkey's employees can sell some of the stock that is a significant portion of their compensation." Honestly, for…

> Why should I invest in a company that does IPO only for some people to do exits?

Exactly. Companies that are making money hand over fist, with amazing growth potential are rarely looking for people to share their wealth with.

Much of the two tech bubbles would have been avoided if buyers had thought through what is going on the other side of the table.

Re: Why SurveyMonkey is holding off on an IPO

#10

Post by glaugh » Thu, Jan 17, 2013, 9:13 PM UTC

Retric wrote: post #3

grzaks wrote: post #2

"And yet, SurveyMonkey [...] has two reasons for raising capital. One is to reward the investment firms, Spectrum Equity and Bain Capital, that bought the company just over four years ago, when it was about a fourth its current size. The other is the perennial tech-industry rationale for an IPO: so SurveyMonkey's employees can sell some of the stock that is a significant portion of their compensation." Honestly, for…

Every time you buy stock someone else is selling it. That does not mean it's a bad buy, just that the seller has different priorities.

For example: "I've got 100% of my wealth locked into one investment, my SurveyMonkey equity, and I'd like to have a more balanced portfolio, so I'll sell half, no matter how much I believe in this company." Seems pretty rational to me.