[human20190310]

> you're probably worth only $20B

This is something I don't get. Pretty much all of these businesses are aiming at dominance on some sector. They entered into the game with the understanding that it's all or nothing.

If they don't achieve that dominance, or if the sector itself turns out to be less than worthwhile, isn't it more likely that these companies are worth essentially zero, rather than some percentage of their target value?

[gumby]

Perhaps dominance is not required, despite their beliefs? There is more than one huge car company and a bunch of medium sized ones too.

It's possible some investors are buying in because they think they are getting into a viable-when-dominance-not-required business on the cheap.

(Me, I don't understand any of these businesses (We, Blue Apron etc) and let someone else take the risk.)

[lotsofpulp]

At the returns the investors want, dominance is required.

Lots of consolidation happening in auto manufacturing too, along with most fields. Even of the car makers that exist, I wonder how many would be kept propped up by a country just to ensure they retain manufacturing capability in case of war.

https://www.reuters.com/article/us-renault-m-a-fiatchrysler-...

[gumby]

The returns the original Investors want: definitely.

But everyone selling at a loss is getting their money from someone buying. Since the price of some of these companies is nonzero, someone must think they are a good deal at that price. Just speculating as to why.

As for war fighting capability: that is the legit justification for ag support, but modern factories can’t be repurposed that way. Nobody would expect IBM to be able to retool to build machine guns any more.

The right fix is many automated reconfigurable on-demand factories making goods close to point of consumption. But that’s a long way away, and wind use humans.

[Tepix]

Why would a coworking space real estate company need to achieve dominance?

[TheOtherHobbes]

Because for Wall St capitalism, dominance is the product.

Which is why steady-but-slow niche businesses don't get this kind of attention, even if they have better long-term prospects.

The product being sold at IPO is the promise of dominance of a market - because that implies a whole set of predictable relationships with investors, employees, and customers.

The product as sold to customers - whatever that is - is almost irrelevant.

A successful IPO is a convincing statement of political intent. We has almost managed that - but not quite enough to get it over the line.

[sweeneyrod]

That's only true for tech companies, and companies like WeWork that brand themselves as tech companies in order to get investors to value them as such. Aramco aren't IPOing with a promise to someday sell all the oil in the world, they're content with merely a lot.