from the welcoming-our-new-ecommerce-overlords dept.
Ars Technica has a story about Alibaba's IPO.
When Alibaba stopped trading its shares on Friday, the Chinese e-commerce company had officially logged the biggest Initial Public Offering (IPO) in US history, raising $21.8 billion in its first day on the New York Stock Exchange. The company's earnings give it a market capitalization of over $200 billion, "putting it among the 20 biggest companies by market cap in the US," the Wall Street Journal notes.
Alibaba's IPO beat out record IPOs like Visa's $17.9 billion IPO in 2008 and General Motors' $15.8 billion sale in 2010. And Alibaba beat out its peers in the tech sector too, like Facebook (whose first-day earnings were $16 billion) and Google (whose 2004 IPO raised only $1.67 billion—paltry in today’s terms).
... this NPR Planet Money story goes a long way in explaining the nature of Alibaba’s business—basically, Alibaba is known for making it easy to buy almost anything from manufacturers in China online, and directly from the manufacturer, at that.
The New York Times story is behind a subscription-wall; try instead these links:
- Fortune Alibaba shares end first day of trading with 38% gain
- NYT DelBook blog: Alibaba’s Shares Close Up 38% on First Day of Trading.
(Score: 2, Insightful) by Anonymous Coward on Sunday September 21 2014, @09:17AM
Once we're working as programmers in mainland China, maybe they'll let us at least write our system documentation in English and use google translate.
(Score: 2, Interesting) by Anonymous Coward on Sunday September 21 2014, @02:53PM
But can you compete?
http://www.npr.org/blogs/thetwo-way/2013/01/16/169528579/outsourced-employee-sends-own-job-to-china-surfs-web [npr.org]
All told, it looked like he earned several hundred thousand dollars a year, and only had to pay the Chinese consulting firm about fifty grand annually
And it turns out that the job done in China was above par — the employee's "code was clean, well written, and submitted in a timely fashion. Quarter after quarter, his performance review noted him as the best developer in the building,
Note that 50k was what the consulting firm got. The actual workers get less of course.
(Score: 2, Interesting) by Anonymous Coward on Sunday September 21 2014, @09:32AM
These are all giant sponges to soak up excess fiat dollars floating around in the money supply. Problem is they are turning excess paper money into excess stock prices. The stock market won't go up forever. In fact every time they put more hugely bloated corporations on the market it takes less and less of a dip to trigger off the coming catastrophe.
(Score: 3, Informative) by canopic jug on Sunday September 21 2014, @11:11AM
The IPO was for a holding company not Alibaba itself. That might make a difference for the gamblers.
Money is not free speech. Elections should not be auctions.
(Score: 0) by Anonymous Coward on Monday September 22 2014, @08:48PM
You also have to keep in mind that you're investing in a company operated in a sort of neomercantilist country that, if push comes to shove, will have few qualms with screwing over foreign investors.
Would you be terribly surprised if China declared that a larger percentage of its corporations needed to be state owned and that they needed to issue new shares to dilute foreign owners?
(Score: 4, Interesting) by PizzaRollPlinkett on Sunday September 21 2014, @03:32PM
The more you look at this story, the more interesting it is. Too much hype and not enough facts. The IPO is of a shell company in the Cayman Islands that might - or might not - get some of the profit from Alibaba some day, if China's government allows it. Owners of the stock aren't owning the actual company. I don't think they have voting rights. The funny thing about how this all works is a lot of people are getting fantastically rich up front off of this IPO. And a lot of other people are holding the bag, which may or may not be filled at some point in the future. I wish I was smart enough to come up with something like this.
If you really want to watch something, head to YouTube and watch the Loomis Simmons video "Make Me Rich" which is what I always think of.
(E-mail me if you want a pizza roll!)
(Score: 2) by bob_super on Monday September 22 2014, @10:55PM
Same Ars article: "About half of the shares were sold to 25 investment firms."
I'm pretty sure the guys putting in that much cash have done a lot more due diligence than us...
(Score: 2) by Non Sequor on Tuesday September 23 2014, @03:22AM
Look up "buy side" and "sell side". The sell side buys things it thinks it can sell, regardless of long term value. The buy side looks for value, although sometimes it gets snookered by the buy side.
My understanding is the sell side is more active in these things and that this is just them getting inventory.
Due diligence is a buy side thing.
Write your congressman. Tell him he sucks.