Private Companies Will Take Money Public Companies Don't Want

bloombergview.com

32 pointsbrunooo4 comments

Matt Levine with one of the most clever lines (as often) regarding the changing valuation dynamics:

"The public stock markets are increasingly about capital return rather than capital raising."

How about the public companies themselves (rather than investors) put the money into private companies in related sectors, via M&A or venture arms? This certainly paid off for Yahoo when it bought a chunk of Alibaba.

Not sure it's wise to put the money back into investors hands where there's less domain knowledge than in the companies the money came from.

Many companies do this already though? It's difficult for me to think of a well-known public company that doesn't do this. If the public company is worth only a single digit billion dollar value or lower, then OK. But if it's worth more, especially triple digit billions, I think they generally all do this already.

Well, the money that went to those companies originally came from those investors, so I'm not sure why would we assume those investors are less knowledgeable.

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