Why SurveyMonkey is holding off on an IPO (opens in new tab)

(tech.fortune.cnn.com)

36 pointsalexconrad13y ago14 comments

14 comments

"And yet, SurveyMonkey [...] has two reasons for raising capital. One is to reward the investment firms, Spectrum Equity and Bain Capital, that bought the company just over four years ago, when it was about a fourth its current size. The other is the perennial tech-industry rationale for an IPO: so SurveyMonkey's employees can sell some of the stock that is a significant portion of their compensation."

Honestly, for me as an occasional stock investor that sounds like a serious warning signal. Why should I invest in a company that does IPO only for some people to do exits? (which was exactly the reason FB did IPO) Stock investors are looking for growth potential. It's just a conflict of interest.

Retric13y ago

Every time you buy stock someone else is selling it. That does not mean it's a bad buy, just that the seller has different priorities.

glaugh13y ago

For example: "I've got 100% of my wealth locked into one investment, my SurveyMonkey equity, and I'd like to have a more balanced portfolio, so I'll sell half, no matter how much I believe in this company." Seems pretty rational to me.

jpdoctor13y ago

> Why should I invest in a company that does IPO only for some people to do exits?

Exactly. Companies that are making money hand over fist, with amazing growth potential are rarely looking for people to share their wealth with.

Much of the two tech bubbles would have been avoided if buyers had thought through what is going on the other side of the table.

ksherlock13y ago

At the time, FB was also hitting the 500 shareholders which meant they had to start reporting everything to the SEC, same as if they were a public company. So why not just go public? (I guess they learned why...) That number may have been bumped up since then.

sjg00713y ago

I am amazed they did so well. Good execution. I like the new building they are constructing in Palo Alto as well.

rschmitty13y ago

I'm also amazed how well they are doing. Do they have some kinda online survey patent or do competitors just suck that much?

crusso13y ago

Chalk me up as dumbfounded as well. How you build a business model upon something so simple, easy to replicate, and (to me) value-less is a mystery.

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neya13y ago

From what I see, they somehow managed to get some top notch clients using their product. I guess it's the level of professionalism their product projects for itself.

jgalt21213y ago

maybe all these lenders/investors are interested in buying access to Facebook. Survey Monkey CEO is married to Facebook COO.

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