
I’ve been in the PE/VC game for a while, on both sides, and there are a number of cast-iron rules about financing pitches (or ‘decks’, as they are known, as in deck-of-ppt-slides):
- the total market they are attacking is always worth at least 1 billion (of whatever currency seems appropriate)
- “if we get even 1% of this market, that’s 10 million”
- “we think we are unique”, etc etc
(The answer to this last assertion is of course: then you obviously don’t know how to use a search engine)
The killer is always the valuation. If you’ve ever watched Dragon’s Den, you’ll know that no budding entrepreneur ever values their leeedle company at less than 1 million (of whatever currency …). “I’m looking for £150,000, in return for 15% of the company”, it’s always the same. I have seen this myself so many times it is scarcely even droll any more.
Now Ocado is the baby of some ex Goldman’s types - the chutzpah is not in short supply. So they are going for full IPO; everything has been scaled up: and Lo! Ocado is worth £1 billion !
Or not. Do yer own DD … and be sure to read Alphaville. And Mr Q.
ND
5 comments:
In the related links on your link to the Alphaville piece is the conspiracy story that Ocado Critic, Philip Dorgan, is let Go By Broker.
A very highly respected retail analyst, he made the comment that the company “begins with an ‘o’, ends with an ‘o’ and is worth zero”.
{I so nearly printed that comment as its quite witty, but it rather undervalues Ocado so I left it out.
Just as well or I might have been ............
For sure this is a crock, new distribution center or not. Who are they kidding? I mean, we would have to be an obese, slovenly type of society to take up this kind of armchair indulgence? Maybe a buy for 20 years down the line?
I'm a gold bug myself and very happy. Looking to punt on the markets and waiting for BP to look attractive, but not yet. (you went in WAY too early city-un) This is one I would avoid like my mother in law.
Ocado is an IPO that won’t fly at its chosen altitude.
That is so poetic that there's a tear in my eye.
Thanks, James, we do our best
Am taking a breather from gold just now Anon, took profits @ 830 (Sterling), the current down-tick has a bit longer to run IMHO but may very well be back after any sustained interval below 770
DYODD etc
personally I don't know how to call BP, except one morning we will wake up to find something dramatic has happened either way
looks like toss-of-a-coin to me
(there are of course options-plays to cater for this state of affairs but that's way beyond a Saturday-morning blog comment)
Ocado Price Cut Ahead Of Stock Market Listing
http://bit.ly/aPQk4H
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