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Technology Stocks : Buying IPOs on the open market -- Ignore unavailable to you. Want to Upgrade?

To: Panita who wrote (5113)	12/8/1999 10:30:00 PM
From: puborectalis	Respond to of 5529

Some history on ANDN ipo......... Slashdot Enters Dutch IPO Oven by James Glave 1:20 p.m. 17.Sep.1999 PDT Slashdot is going to Wall Street and inviting the nerds along for the ride. Andover.Net, the parent company of popular open-source news and gossip community Slashdot.org, filed initial public offering documents with the Securities and Exchange Commission on Friday. See also: Slashdot: All the News that Fits "This means that we are officially in a quiet period and I can say nothing more than "no comment" from this point on," wrote Slashdot editor Rob "CmdrTaco" Malda in a posting on the Slashdot site. Keeping silent won't be easy. Malda is the empresario of a combined geek news wire and discussion forum that attracts 600,000 page views a day. Slashdot is the virtual water cooler for nerds around the world, where members gossip, report, and speculate on everything from PalmPilots to Star Wars. WR Hambrecht and Co. will underwrite the Andover.Net offering of 4 million shares. Shares are expected to sell for between $12 and $15. The exact figure will be determined through the underwriter's OpenIPO system. That arrangement, more commonly known as a modified Dutch auction, allows interested investors to place a bid for the number of shares they want to own and the price they want to pay. In effect, it will allow anyone the chance to bid for shares in Andover.Net before the stock begins trading. That's a critical move for the company, because the arrangement will effectively include the thousands of programmers, developers, and tech-watchers who contribute to Slashdot. Giving Slashdot.org participants a chance to buy stock before opening day "is the main reason we are doing what we are doing," Andover.Net spokeswoman Janet Holian said. Normally, only big institutional investors have a shot at buying shares before they begin trading on opening day. The little guy is largely left out of the action. continued Andover.net really couldn't have done it any other way. Slashdot, the company's cash cow, is built on the volunteer contributions of its readers. Should that goodwill dissolve, so too will the business, as a section of the company's S1 registration statement attests. "Some members of the open source community have criticized the commercialization of the Open Source movement," the risk factors portion of the document reads. "This type of negative reaction, if widely shared by our visitors, developers, or the rest of the open-source community, could harm our reputation and diminish the Andover.Net brand. Our business, results of operations, and financial condition could suffer." There is more than a hint of this issue in the Slashdot discussion of the Andover.Net IPO. "It's really humorous to watch the Linux community cash in like this," wrote one anonymous Slashdot poster. "It just goes to show why communism will never work. You can talk all you want about community and sharing but in the end everybody gives in to greed." The poster made reference to the recent IPO by Red Hat Software. In that offering, the company attempted to offer stock options to members of the volunteer Linux development community. In the end, few members of the Red Hat Linux community were able to take advantage of the offering because of a snafu with online broker ETrade. Those who were able to get in on the opening made a bundle: Red Hat shares shot up to US$52.06 on the company's opening day last month, nearly tripling its $14 offering price. "At least Microsoft paid people to write software they sold," the Slashdot poster wrote. "Red Hat just stood on the shoulders of giants and plucked money off the tree." But the Open IPO model may not be a smooth road for Slashdotters, either. Some analysts were unimpressed with the proceedings of Salon.com, the last Internet company to pursue a Dutch auction IPO with WR Hambrecht and Co. "[The Salon.com IPO] didn't work out that well," said Steven Tuen, an analyst with IPO Value Monitor. "So far, the deals done by WR Hambrecht -- which exclusively uses the Dutch auction model -- haven't really seen the type of return that the traditional avenues have seen." Tuen suggested that the shortfall may be due to the fact that investors are not familiar with how the Open IPO process works. "They need to gain critical mass," he said. But a Salon.com employee disagreed with that assessment. "Our thinking on it at the time was that we maxed what we could have gotten out of the IPO process by using [the Dutch auction] method," the source said. "Our main goal was staying afloat and keeping going and getting working capital, and for that it was great."

To: Panita who wrote (5113)	12/8/1999 10:40:00 PM
From: Canuck Dave	Read Replies (1) \| Respond to of 5529

Agree with you on LNUX. Probably only attractive on a market tank day. In fact, that is the ONLY time I buy them on the IPO day any more. I lucked out with ITXC and then got burned a few times before I figured it out. 1. Good strong IPO 2. Bad Market 3. Lots of other more touted issues IPO'ing the same day. Been waiting for another one like ITXC for a while. CD