Quote:
Originally Posted by tony286
Considering how every porn stock has been a dog, I cant see how it could be a vehicle to get a pile capital.
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OK tony lets say you own tonysporn inc. and you are the sole shareholder of 1 million shares.
tonysporn inc is operating in the black (just barely) and has assets of a modest 1 million dollars
if you do an IPO at 3 dollars a share (not unreasonable) of 499K of your 1M Shares
You immediately raised 1.5 M cash at a cost of converting your assets from private to public. Now if you make poor decisions and piss away that 1.5M and the stock drops to 1 dollar a share, ya the offering is a failure...but you got your money.....ask Hugh hefner about how a dog stock can prop up your lifestyle....
On the flip side if you invest that money wisely and your company assets grow and your business grows and the price goes up....well nuff said.
Ya its a tad over simplified but you get the point