Fat Bottomed Girl – Queen
Heard this song today walking to the office. It’s been stuck in my head ever since. Love the guitar & I miss Freddie Mercury.
Month: May 2009
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Johnny Damon is the man.
(Source: http://www.youtube.com/)
Drops In The River – Fleet Foxes
Love this band. Love this song.
The Facebook secondary market
It’s not a secret that there was an active secondary market for Facebook common shares.
And it looks like there continues to be significant interest in the common stock. VentureBeat reports that Facebook employees are selling $150M worth of common shares to a combination of new and existing investors.
Few thoughts on the matter:
1 – The news here is the $10/share number and the total amount of the deal. The valuation isn’t available. I’m guessing this deal could represent as much as 3-4% of the company in aggregate or as low as 1%. And that is for common stock.
2 – As many of you know when you join a startup and receive options they are typically priced at 10-25% of the preferred price per share. (I won’t go into the logic of that in this post). But needless to say that low price per share is a big incentive to employees. This is a great way for companies to recruit without burning near term cash. Plus, it ties together employee and company long term goals.
However, if there is an active secondary market for employee shares the presumably higher valuation for those shares will significantly impact common options for future grants. The company’s board can’t approve an option for a new employee at $1.00/share if the outside world is pricing those common shares at $15/share.
3 – We need incentives for investors and employees to gain liquidity. I’m all for that as you can imagine. This secondary tells me that a FB IPO isn’t close at hand. So this active secondary market has some nice attributes for buyer & seller. I could be wrong but it doesn’t appear that any existing investor is selling any shares at this price.
4 – Employees receive the proceeds not the company balance sheet. Right now Facebook isn’t cash flow positive. I’m an outsider I don’t know how close they are to CFBE. Maybe they are quite close. It’s a key question and impacts all shareholders.
As a general rule, if a company needs cash then I would limit these secondary deals if possible. If the company is printing cash then I would have less concerns.
Not Your Lover – Blitzen Trapper
From the album Furr
The public school system is failing those who need it most
Lauren and I went to a lunch yesterday and met with US Senator Michael Bennet.
Senator Bennet talked about a number of things but I felt much of his passion around his desire to fix our public schools. Prior to becoming Senator he was the superintendent for the Denver Public Schools.
He had a balanced view about the blame (all of us adults, not the kids) but he first shared a few data points to make the point loud & clear. Here’s some of the things I learned.
-70% of 8th readers don’t read at their grade level
-a nine year old from a low income family is already 3 years behind their high income peers and has a 1 in 2 chance of graduating high school and 1 in 10 chance of finishing college
– 1.2M of our students drop out of high school every year. Globally we rank 20th amongst industrial nations for high school graduations. Forty years ago we were first
Great education starts with the best teachers. And we are not helping recruit and keep our best teachers either. Current salaries are beyond ridiculous for teachers. We need to fix that. Teacher unions and the administrators need to ditch their current power struggles for the old discussion and ditch sacred cows. They aren’t working. Currently half of our public school teachers quit in the first five years.
There were many more stats and facts shared but the Senator’s punchline was clear when he said, "Our public education system, as designed, does not work well enough for all children in this country, and, for our poorest children, barely works at all.“
I am fortunate that our kids live in a town where we have good public schools. And I am hardly the expert in public school matters across our nation. I learned a lot yesterday about things I knew in my gut. I need to learn more about these issues and how we can help.
I am convinced the first step is stand up and acknowledge the current model isn’t working. We can’t accept it. We can do better.
We made a campaign contribution yesterday. I think Senator Bennet is exceptionally bright and believe he’s focused on the right issues. I hope he keeps his office next year.
For the 1st time ever, more people are finding my blog from Twitter and Facebook referrals than via Google. The total number of people coming to my blog is increasing. The percentage of people who find it via Google is declining. Significantly.
How Twitter and Facebook Now Compete with Google – Mark Cuban
Sometimes when we see numbers it’s hard to put them in context.
Consider the absolute numbers of people that aren’t educated or live in poverty or don’t have adequate healthcare. The numbers can be overwhelming.
This visual presentation helps by asking what if the world was condesed to a village of 100 people. Worth watching.
(please note: the text in the beginning was meant to go fast to make a point about how confusing the numbers are without context)
(Source: https://www.youtube.com/)
Fake Plastic Trees – Jeff Tweedy
Great cover. Original by you know who.