Greetings, View fans. Surely you know the big story of the day by the time you clicked here. The offering price: $26. Market cap: $18.1 billion. Price-to-sales ratio: 34. And that’s before trading even has begun. Price-to-earnings ratio: N/A. Who needs earnings when Twitter has wings, prayers and 230 million users?
Peter Eavis enjoyed writing this opening way too much
Here’s how he began his curtain-raiser about Twitter’s initial public offering today: “Twitter is a young company generating large losses as it competes in a highly uncertain sector of the economy. And that is exactly why investors clamored for a piece of its initial public offering, which closed on Wednesday evening.” Makes sense: The more money it loses the more it’s worth! For his kicker he quotes a Northwestern University accounting professor, Anup Srivastava, who has this fuddy-duddy idea that fundamentals should matter: “One day Twitter will make money. But it’s not clear why anyone should pay this much for it today.” And on that sober note, let’s move on.
A long time to spend in the pokey
The feds couldn’t nail any senior Wall Street executives after the financial crisis. But they sure did a number on Edward Woodard, 70, of Norfolk, Virginia, who was sentenced yesterday to 23 years in prison for bank fraud. Woodard was chairman and chief executive officer of Bank of Commonwealth, now defunct. Christy Romero, inspector general for the Troubled Asset Relief Program said: “Motivated by greed, Woodard lied, cheated and stole.” Hogs get fat, piglets get slaughtered. Lesson learned.
The secret to Stanford’s success at football
It’s the way the university finances its team. Stanford has a tiny stadium and not much revenue compared with traditional powerhouses. From Ben Cohen of the Wall Street Journal: “The way Stanford keeps up in the college-football arms race is to lean on private donations. As a result, almost everything the football program touches is endowed, from each of the school's 85 football scholarships to David Shaw's head-coaching position. Stanford's offensive coordinator is even known as the Andrew Luck Director of Offense in honor of an anonymous gift in 2012.”
China’s dirtiest corporate war
This is an amazing story from Beijing-based Caixin Online about the nasty rivalry between two of China’s biggest machinery manufacturers, Sany and Zoomlion. “It's a years-long war that's been largely hidden from the public eye, on a battlefield littered with charges and counter-charges of espionage, slander and back-door deals in the Hunan Province city of Changsha,” write Zhang Boling and Yu Ning. “That these two companies have been at each other's throats was never entirely clear. No one knows, for example, who posted on the Internet false financial reports about Sany that scared investors two years ago and sank the company's bid for an initial public offering. Some blamed Zoomlion, but investigators following orders for a probe from then premier Wen Jiabao found nothing wrong. The recent downfall of journalist Chen Yongzhou, however, changed everything. Widely reported across China was news that Chen, a reporter for the Guangzhou-based newspaper New Express, had been detained by Changsha police October 18 for allegedly writing lies about Zoomlion's finances in exchange for money.”
OK, one more Twitter story
This story comes from TechCrunch about Biz Stone, the Twitter co-founder who now runs a foundation devoted to animal welfare. He spoke yesterday at a conference in San Francisco where he talked about his biggest foul-ups, including the one that spawned Twitter: “It’s possible that the mistakes of your life are way more interesting than any of your successes. They certainly have been for me and they’ve helped me a lot.” His first tries “were all failures, but the next startup, Twitter, was a success and now I get to go ring the bell on Wall Street.”
(Jonathan Weil is a Bloomberg View columnist. Follow him on Twitter.)