Please provide extraordinary proof for the extraordinary claim that tech IPOs are rigged to transfer shareholder value to the banks managing or participating in the OP.
Re:TWTR
by colinbartlett on Thursday November 07, 2013 @12:30PM
(#6690767)
That was informative, thanks.
Virtually every IPO is priced such that the market price is substantially higher than the offer price. This unquestionably transfers money from the market to those who are allowed to buy at the IPO price. That they are designed to do that seems like a reasonable conclusion from the fact that it happens over and over again.
Furthermore, when an IPO is priced such that this does not happen, such as with Facebook, it's criticized and called out as a disaster even though they sold all the stock they wanted to issue and made much more money for their company than they would have otherwise.
If you were able to do that, that means that VMWare and Visa both got screwed out of billions of dollars.
And of course, little guys can't get in right at the IPO price. That's reserved for big players. By systematically underpricing IPOs, the finance folks make billions of dollars for their friends at the expense of the companies they're supposed to represent.