Lucas, Have to disagree with you. There is no evidence that current positive
or negative cash flow has any significant impacts on a fast-growth company
's longterm successes/prospects, and their valuations.
There is, however, a direct correlation between a fast-growing company 's
ABILITY TO RAISE CASH to its longterm successes and prospects.
I can name so many successful companies which had very little
cash on hand during their fast growing period, including all the great ones
like ASND, CISCO - but their growth and share prices never stopped moving
because lack of cash. These companies have the ability to raise lots of
money when management see fit to do so.
Concerning secondary offering vs. private offering. It's true that we shareholders
do not yet know the details of the private offering, and we may get shafted by
the deal. However, public offering is a huge undertaking which MRVC may
not have the resource to divert to that effort - road shows, negotiations, etc.
When all is said and done, I am not so sure that a public offering (unless done
at an excellent price) would produce more financial benefits than a quick
and painless private offering.
Given IOMG 's successes so far, I don't think they will have any problem
raising cash if needed. I am glad, however, that they are careful not to dilute
shares just to have lots of cash to sit on. |
