Curious if anyone else reading this knows about the equivalent of US "pink sheets," publicly traded companies that have either never been listed or have been delisted due to low share price / market capitalization.
Here in the US, you can buy publicly traded companies in the US for a song; in fact, that was the source for the "acquiring" company in a lot of those reverse-acquisitions of the late 2000s / early 2010s: publicly traded companies that had a ticker, but were basically defunct. A company that wanted to go public without the scrutiny of an IPO process could "buy themselves" with the tiny, publicly traded company, thereby getting a ticker and access to retail investors. (This was not a good phenomenon, fwiw, though it definitely anticipated the SPAC craze... which was also not good, for similar reasons.)
It gives the unwitting a chance to lose their money. “Do your homework” against professionals whose job it is to make your homework as difficult as possible, including the very tactic you seem to be arguing for.
Meanwhile, if things such as SPACs are such solid investments, why are they pulling such weasely stunts to begin with? (A rhetorical question, at least it is to me.)
Yeah; you shouldn't be trading pink sheets if you're an unwitting investor. It's there to make your job as easy as possible. You shouldn't be trading OTC or pink sheets or any of these things.
SPACs can be solid investments. A SPAC is just a reverse acquisition to avoid listing costs, or sometimes because you're putting faith in a capital allocator. Again, investment carries risk of loss. I'm not sure what you're being critical of. Are you saying that we should only allow companies to go public through investment banks taking millions of dollars of fees?
The NASDAQ should not become Pancakeswap, Polymarket, or pump.fun. If you want to invest in those products, you know where to find them (and it's not the NASDAQ).
Companies like these are hard to find in the US because of the twin curses (or joys, depending on your views) of "maximizing shareholder value" and "SEC regulation".
If you list on a big exchange, your investors will expect revenue and profit to go brrr quarter after quarter forever. It's a treadmill you can never get off. Amazon is uniquely special in that Bezos persuaded investors to keep faith for the best part of a decade. Or perhaps "lucky": one wonders what their stock price would have done without the incredible luck of the former side hustle of AWS becoming the engine of their business. (Not to denigrate the incredible feat that it is, or the work that went into it.)
Regulation provides some practical limits on how small you can be, too. All those 10-Ks and audits and SOX compliance don't come cheap. You need to be big enough to employ specialists to do it or rich enough to partner up with Deloitte.
The alternative is to list on a pink sheet exchange, but then you are keeping company with a long long tail of companoes that give off sketchy vibes. A one man Nevada corporation selling healing oils, or an interest in a hitherto-undiscovered source of limitless energy. I cant think of any company that graduated from this part of the market into full DJI/Nasdaq respectability. Maybe someone knows of one?
>> The alternative is to list on a pink sheet exchange
Nah, there's OTC which is different than pink sheet. There's a couple of levels of OTC above that, between the pink sheets and the exchange traded stocks.
Plenty of OTC stocks have graduated, plenty of respectable stocks have gone from exchange traded to penny stock status and back.
Pink sheet stocks though? I don't know. Who buys those? Postmen? There's always postmen.
> investors will expect revenue and profit to go brrr quarter after quarter forever. It's a treadmill you can never get off.
When you have money to place somewhere, it is natural to look for a place that gives you a great return. Since share price is a function of future expected earnings, it stands to reason that the company will try to grow earnings for the shareholders (since they, collectively, own the company).
> If you list on a big exchange, your investors will expect revenue and profit to go brrr quarter after quarter forever. It's a treadmill you can never get off.
> or an interest in a hitherto-undiscovered source of limitless energy.
Before Covid I thought I'd chuck a few hundred dollars into a trading app to understand that 'game' a little bit better. I chose a few companies I knew from work and some biotechs that had fun ticker names. One company had 'mRNA' which I thought was funny, so I bought 50 dollars of stock.
Turns out mRNA stands for Moderna and I wish I put in more than 50 dollars as it went from ~$19 to almost ~$400 per share.
I, too, wish I’d put more into my winners, and less into the losers. But what I really wish is to figure out which is which before I lay money down. :-)
The reverse is also interesting. Large corporations who have refused to become publicly traded or take on investors at all, even though they have had every opportunity. Bosch comes to mind, which, like two of the examples in the article, also is from Germany.
Curious if anyone else reading this knows about the equivalent of US "pink sheets," publicly traded companies that have either never been listed or have been delisted due to low share price / market capitalization.
Here in the US, you can buy publicly traded companies in the US for a song; in fact, that was the source for the "acquiring" company in a lot of those reverse-acquisitions of the late 2000s / early 2010s: publicly traded companies that had a ticker, but were basically defunct. A company that wanted to go public without the scrutiny of an IPO process could "buy themselves" with the tiny, publicly traded company, thereby getting a ticker and access to retail investors. (This was not a good phenomenon, fwiw, though it definitely anticipated the SPAC craze... which was also not good, for similar reasons.)
Why not good? Gives an investor a chance to invest.
Investment has the risk of loss. You should do your homework before risking the loss!
Gives an investor a chance to invest.
It gives the unwitting a chance to lose their money. “Do your homework” against professionals whose job it is to make your homework as difficult as possible, including the very tactic you seem to be arguing for.
Meanwhile, if things such as SPACs are such solid investments, why are they pulling such weasely stunts to begin with? (A rhetorical question, at least it is to me.)
Yeah; you shouldn't be trading pink sheets if you're an unwitting investor. It's there to make your job as easy as possible. You shouldn't be trading OTC or pink sheets or any of these things.
SPACs can be solid investments. A SPAC is just a reverse acquisition to avoid listing costs, or sometimes because you're putting faith in a capital allocator. Again, investment carries risk of loss. I'm not sure what you're being critical of. Are you saying that we should only allow companies to go public through investment banks taking millions of dollars of fees?
Unlike with memecoins, there's actually an operating company behind these stocks. It's good that they can access capital in public markets.
The problem imo is a lack of enforcement on modern pump and dumps.
The NASDAQ should not become Pancakeswap, Polymarket, or pump.fun. If you want to invest in those products, you know where to find them (and it's not the NASDAQ).
Companies like these are hard to find in the US because of the twin curses (or joys, depending on your views) of "maximizing shareholder value" and "SEC regulation".
If you list on a big exchange, your investors will expect revenue and profit to go brrr quarter after quarter forever. It's a treadmill you can never get off. Amazon is uniquely special in that Bezos persuaded investors to keep faith for the best part of a decade. Or perhaps "lucky": one wonders what their stock price would have done without the incredible luck of the former side hustle of AWS becoming the engine of their business. (Not to denigrate the incredible feat that it is, or the work that went into it.)
Regulation provides some practical limits on how small you can be, too. All those 10-Ks and audits and SOX compliance don't come cheap. You need to be big enough to employ specialists to do it or rich enough to partner up with Deloitte.
The alternative is to list on a pink sheet exchange, but then you are keeping company with a long long tail of companoes that give off sketchy vibes. A one man Nevada corporation selling healing oils, or an interest in a hitherto-undiscovered source of limitless energy. I cant think of any company that graduated from this part of the market into full DJI/Nasdaq respectability. Maybe someone knows of one?
>> The alternative is to list on a pink sheet exchange
Nah, there's OTC which is different than pink sheet. There's a couple of levels of OTC above that, between the pink sheets and the exchange traded stocks.
Plenty of OTC stocks have graduated, plenty of respectable stocks have gone from exchange traded to penny stock status and back.
Pink sheet stocks though? I don't know. Who buys those? Postmen? There's always postmen.
> investors will expect revenue and profit to go brrr quarter after quarter forever. It's a treadmill you can never get off.
When you have money to place somewhere, it is natural to look for a place that gives you a great return. Since share price is a function of future expected earnings, it stands to reason that the company will try to grow earnings for the shareholders (since they, collectively, own the company).
> If you list on a big exchange, your investors will expect revenue and profit to go brrr quarter after quarter forever. It's a treadmill you can never get off.
> or an interest in a hitherto-undiscovered source of limitless energy.
Doesn't sound so different actually :)
Other than potentially scummy stuff what even is the benefit to a small company listing on a pink sheet exchange?
Before Covid I thought I'd chuck a few hundred dollars into a trading app to understand that 'game' a little bit better. I chose a few companies I knew from work and some biotechs that had fun ticker names. One company had 'mRNA' which I thought was funny, so I bought 50 dollars of stock.
Turns out mRNA stands for Moderna and I wish I put in more than 50 dollars as it went from ~$19 to almost ~$400 per share.
I, too, wish I’d put more into my winners, and less into the losers. But what I really wish is to figure out which is which before I lay money down. :-)
The reverse is also interesting. Large corporations who have refused to become publicly traded or take on investors at all, even though they have had every opportunity. Bosch comes to mind, which, like two of the examples in the article, also is from Germany.