Max, some snippets from EXDS' prospectus before their IPO:
This offering involves a high degree of risk.
. The Company's actual results could
differ materially from those discussed in this Prospectus.
LIMITED OPERATING HISTORY; HISTORY OF LOSSES
Since it began to offer server hosting
services in 1995, the Company has experienced operating losses and negative cash flows from operations in each quarterly and annual period. As of December 31, 1997, the Company had an accumulated deficit of approximately
$30.6 million. The revenue and income potential of the Company's business and market is unproven, and the Company's limited operating history makes an
evaluation of the Company and its prospects difficult. Currently, the Company anticipates making significant investments in new Internet Data Centers and product development and sales and marketing programs and personnel and therefore believes that it will continue to experience net losses on a quarterly and annual basis for the foreseeable future. The Company and its prospects must be considered in light of the risks, expenses and difficulties
encountered by companies in the new and rapidly evolving market for Internet system and network management solutions. To address these risks, among other things, the Company must market its brand name effectively, provide scalable, reliable and cost-effective services, continue to grow its infrastructure to accommodate new Internet Data Centers and increased bandwidth use of its network, expand its channels of distribution, retain and motivate qualified
personnel and continue to respond to competitive developments. Failure of the Company's services to achieve market acceptance would have a material adverse effect on the Company's business, results of operations and financial
condition. Although the Company has experienced significant growth in revenues in recent periods, the Company does not believe that this growth rate necessarily is indicative of future operating results, and there can be no assurance that the Company will ever achieve profitability on a quarterly or an annual basis or will sustain profitability if achieved. See "Management's Discussion and Analysis of Financial Condition and Results of Operations."
I'm just posting a portion of their prospectus. The whole thing reads like a big warning that says, "If you invest with us, be prepared to lose everything you have."
freeedgar.com
Max, I believe there is a basic fundamental principle that says the return on an investment is a function of the element of risk involved. The greater the risk, the greater the potential return. However, the potential return is not guaranteed, and I do not believe that people should be compensated when they are blinded by their own greed make extremely risky and speculative investments.
Normally when retirees sit down with a financial advisor, hopefully from a trust department at a good conservative local bank, they are asked what their objectives are for their money. I imagine very few say "I'd like to be as bloody rich as possible by any means necessary." Most would give a dollar amount that they'd like to achieve in annual earnings, and a diversified product would be assembled to deliver that returns, including bonds and other fixed rate investments.
Anyway, I agree with you that the Wall Street guys are and always will be corrupt. It has become almost impossible to perform oversight as the SEC's budget has not kept up with the explosion of trading. My point of view is that somewhere along the line an individual has to take responsibility for their own investment decisions instead of trying to pin the blame on others. |
