[grzaks]

"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.

[Retric]

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.

[glaugh]

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.

[jpdoctor]

> 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.

[ksherlock]

At the time, FB was also hitting the 500 shareholders which meant they had to start reporting everything to the SEC, same as if they were a public company. So why not just go public? (I guess they learned why...) That number may have been bumped up since then.