Yasbarista: Green Tea Latte expert :flag_agender:🏳️⚧️ on Nostr: Discord and Reddit are financially *fucked*, my friends. Fucked. As you may be aware, ...
Discord and Reddit are financially *fucked*, my friends. Fucked. As you may be aware, both of these companies are moving towards an IPO — a listing on the open stock exchanges. They have no choice to do so because their present investors want a return on their investments now, rather than later (this is due to interest rates).
But now we come to the main thing: Discord and Reddit have had their potential valuation cut by a whopping 47% and 45% respectively. That is only one investor (Fidelity FGBRX), but imagine the others invested in both companies are thinking the same.
What this means is that if investors who are already *inside* these companies are getting spooked; investors who will see these shares on the public market will get cold feet. It will mean that Discord and Reddit will have a poisoned IPO — where no matter how high the initial price, the value of the shares will sink like a stone.
Once that happens, there is no way back up, especially in the fragile economic situation. Reddit and Discord are toast, and it's only a matter of "when the investor cash runs out".
But now we come to the main thing: Discord and Reddit have had their potential valuation cut by a whopping 47% and 45% respectively. That is only one investor (Fidelity FGBRX), but imagine the others invested in both companies are thinking the same.
What this means is that if investors who are already *inside* these companies are getting spooked; investors who will see these shares on the public market will get cold feet. It will mean that Discord and Reddit will have a poisoned IPO — where no matter how high the initial price, the value of the shares will sink like a stone.
Once that happens, there is no way back up, especially in the fragile economic situation. Reddit and Discord are toast, and it's only a matter of "when the investor cash runs out".