Comments on: Silver Spring Networks IPO expected on Wednesday

By: josebrwn

josebrwn — Thu, 18 Apr 2013 22:27:45 +0000

Reverse stock splits hurt employees in a roundabout way. You’re given a number of options as part of your compensation and never told about a reverse split, which they know perfectly well will happen. You calculate your net worth and what you’re willing to receive in salary, and how hard you’re willing to work and how long you’re willing to stick around, based on that number. Then they pull the rug out from under you, and your compensation is 5 or 10 times less than what you were told (implied, lied, take your pick).

If companies wanted to be honest about it they’d be upfront about how many basis points you have, and how they’re being diluted with every round of financing. But they don’t do that because people would leave and/or demand better compensation.

By: Scottie too Hottie

Scottie too Hottie — Wed, 13 Mar 2013 14:36:07 +0000

As a percentage, it’s the same genius. That’s all that matters. Percentages are in Arithmetic 102, so I understand if you didn’t make it that far. Stop being scared of big numbers. Percentages are your friends.

By: vested

vested — Wed, 13 Mar 2013 03:57:17 +0000

they did; it’s in the S1, page 11

http://www.sec.gov/Archives/edgar/data/1180079/000119312513092008/d17578ds1a.htm

By: vested

vested — Wed, 13 Mar 2013 02:34:29 +0000

I believe that the overarching point is that the employee grants are worthless in the sense that they cost more to exercise than they will be worth on the open market.

Arithmetic 101.

By: Scottie too Hottie

Scottie too Hottie — Wed, 13 Mar 2013 01:59:00 +0000

Frank – Using your logic, under the original $4 per share options the IPO would have been set at $3.4 per share. Would you have been happier with a $4 per share option on a sub-$4 per share IPO? Would you like to brag to all your friends that SSNI’s stock was worth a whopping $4 per share?

Let me ask you this: Would you rather have 100 shares of SSNI at $3.4/share, or 20 shares of SSNI at $17/share? You need to go join Scott and Vested in Econ 101.

By: Sol Rosenberg

Sol Rosenberg — Wed, 13 Mar 2013 01:46:02 +0000

Looks like Frank Rizzo is an insider…a disgruntled one at that…

By: Chattergal

Chattergal — Wed, 13 Mar 2013 01:28:33 +0000

Is this 5 – 1 reverse split really in the ipo? Wouldn’t Silver Spring have had to notify the stockholders of this?

By: Frank Rizzo

Frank Rizzo — Wed, 13 Mar 2013 00:00:57 +0000

“Vested” is correct. Folks that started in 2009 that got $4 per share options now have options at $20, with the company set to IPO at $17…why would anyone be happy with a $20 option on a sub $20 IPO. Not to mentioned those people now have 1/5th of the stock they started with. Don’t even start to talk about the people that got options at $11….with their now smoking hot $55 per share option price.

By: Scottie too Hottie

Scottie too Hottie — Tue, 12 Mar 2013 23:36:00 +0000

No, strike prices are typically adjusted appropriately during a standard/reverse stock splits. C’mon now, you and Scott shouldn’t have skipped Econ 101.

By: vested

vested — Tue, 12 Mar 2013 23:29:04 +0000

Just that all shares granted to employees since January 2010 are under water.