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CCP brings in $66M in revenues. Contemplates IPO
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Professor Alphane
Les Corsaires Diable
#41 - 2012-02-22 13:26:58 UTC
Adunh Slavy wrote:
Professor Alphane wrote:
Failed Economics 101 so don't fully understand what an IPO is, can anyone enlighten me.


It's not Econ, it's finance. Finance 101 would have covered it.

It's a sale of stock and the first sale, "initial public offering", IPO. CCP sells the shares directly or to an "underwriter". The money they raise from the stock sale is then used to run the business.



So there isn't stock now and there will be....

or

there is stock but they wnat to make more because they believe there company is undervalued?

[center]YOU MUST THINK FIRST....[/center] [center]"I sit with the broken angels clutching at straws and nursing our scars.." - Marillion [/center] [center]The wise man watches the rise and fall of fools from afar[/center]
Ursula LeGuinn
Perkone
Caldari State
#42 - 2012-02-22 13:34:49 UTC  |  Edited by: Ursula LeGuinn
Professor Alphane wrote:
So there isn't stock now and there will be....


There are shares — but they're owned by private investors. Not just anyone can buy into a privately-held company, because the option simply isn't available to the general public.

An IPO means shares will be made available for purchase by the general public.

As for the why of it, an IPO would probably mean more capital for CCP to work with. At the same time, it means less control over who owns shares in the company, and a greater number of shareholders wanting to see their investments grow.

"The EVE forums are intended to provide a warm, friendly atmosphere for the EVE community." — EVElopedia
Darrow Hill
Vodka and Vice
#43 - 2012-02-22 13:38:56 UTC
Professor Alphane wrote:
So there isn't stock now and there will be....

or

there is stock but they wnat to make more because they believe there company is undervalued?


There is "stock" now; privately held, not available on an open market, and not easily sold.

An IPO, typically, offer "common" shares with ownership and voting rights in some form or another.


IPO's have nothing to do with "valuation". It's a fundraising alternative to debt (or, in the case of many companies such as Facebook, Groupon, etc., it offers the current owners / venture capitalists a chance to cash out of their initial investment).
Darrow Hill
Vodka and Vice
#44 - 2012-02-22 13:47:06 UTC
Ursula LeGuinn wrote:
As for the why of it, an IPO would probably mean more capital for CCP to work with. At the same time, it means less control over who owns shares in the company, and a greater number of shareholders wanting to see their investments grow.


Lets make this as blunt as possible.


66 million in revenue is peanuts.

It really is.

EvE, in itself, is profitable and self sustaining. However EvE is not CCP's only project. If you ever took a look at CCP's basic financials from 2010, it's plainly obvious that the only way CCP can continue to develop Dust 514 and WoD is by using external financing.

They need cash.
Vertisce Soritenshi
The Scope
Gallente Federation
#45 - 2012-02-22 13:55:53 UTC
Darrow Hill wrote:
Ursula LeGuinn wrote:
As for the why of it, an IPO would probably mean more capital for CCP to work with. At the same time, it means less control over who owns shares in the company, and a greater number of shareholders wanting to see their investments grow.


Lets make this as blunt as possible.


66 million in revenue is peanuts.

It really is.

EvE, in itself, is profitable and self sustaining. However EvE is not CCP's only project. If you ever took a look at CCP's basic financials from 2010, it's plainly obvious that the only way CCP can continue to develop Dust 514 and WoD is by using external financing.

They need cash.



You don't know this for a fact. Either way, whatever CCP decideds to do financially I hope it has a positive outcome for EvE and DUST.

Bounties for all! https://forums.eveonline.com/default.aspx?g=posts&m=2279821#post2279821
Professor Alphane
Les Corsaires Diable
#46 - 2012-02-22 14:03:14 UTC
So would this open CCP to a hostile takeover ?

[center]YOU MUST THINK FIRST....[/center] [center]"I sit with the broken angels clutching at straws and nursing our scars.." - Marillion [/center] [center]The wise man watches the rise and fall of fools from afar[/center]
Darrow Hill
Vodka and Vice
#47 - 2012-02-22 14:03:47 UTC
Vertisce Soritenshi wrote:
You don't know this for a fact. Either way, whatever CCP decideds to do financially I hope it has a positive outcome for EvE and DUST.


It's all on the cash flow statement.

With luck, we won't have to wait until July to see the results for 2011.
Doc Severide
Doomheim
#48 - 2012-02-22 14:10:13 UTC
W1rlW1nd wrote:
Gantz Tleilax wrote:
The Gonif wrote:


This might seem like an illustration that traditional CCP has already been experimenting with free-to-play in EVE, by allowing rich subscribers to essentially pay for others to play, in exchange for virtual currency — something that has been used by 40,000 people, the company says.


Can someone explain what this means? Rich subscribers paying others to play?



"Rich" player pays real money for own subscription, and plex. "Rich" player puts Plex on game market.
"Other" player buys Plex in game with fake money, and uses the Plex to extend subscription.

Thus, "Rich" player has paid real money for someone else to play, in exchange for fake money to throw around in-game.



Yep for all the people I helped to play for free, you are very welcome. Bought $4K in GTC's over the last 3 years.... I get Grind Free ISK, others who can't otherwise afford to play, get to play. Everyone wins...
Oh and for those who say "You could have spent that on other things", well I certainly did that too...
Joe Skellington
Sarz'na Khumatari
#49 - 2012-02-22 14:24:37 UTC
Nova Fox wrote:
CCP please maintain majory stock...

Companies like EA would destroy this company and game if given the chance.


I can see Bobby Kotick licking his liver stained lips anticipating the possibility to destroy another MMO.

Please note that ASCII art is not permitted in the forum signatures. Spitfire
Henry Haphorn
Killer Yankee
#50 - 2012-02-22 14:36:34 UTC
Currently, I'm taking macroeconomics in college.

From what I understand, the purpose of a company handing out shares to multiple investors is to limit control of any one investor over the company. So, even if the Goons and the DRF were to compete for control of the majority of the those shares, none will have majority control when the general public becomes involved (too many shareholders to compete with).

Also, if you ask any of the shareholders how they view their position/relationship with the publicly-traded company, they will most likely tell you they don't feel like they got control of the company; therefore, they feel more like investors rather than owners.

Now, I'm not so sure if this is still legal or not, but back in the days there use to be plenty of American companies that incorporated what economists would refer to as a "poison pill policy" when it comes to shareholders. The poison pill policy comes in many forms, but one common form of it was to dilute the value of the shares by pumping new shares into the public as soon as one shareholder even tries to own a certain percentage of available shares. This is meant to discourage any one shareholder from having too much control of the company.

The Board of Directors and the Council of Stellar Management

If CCP Games does decide to file an IPO in the foreseeable future, how will this affect the CSM once a BoD is put together? I worry that with this combination, CCP could face a dilemma that is threefold:


  1. Chief Executive Officer wanting to use the revenue to improve the company (ie: new equipment, more employees, etc.).
  2. Chairman of the Board of Directors wanting to use the revenue towards satisfying the shareholders.
  3. Chairman of the Council of Stellar Management wanting Eve Online to be iterated on or expanded on meant towards satisfying the players who directly elected them.


This could become corporate schizophrenia if CCP files an IPO.

Adapt or Die
Eugene Spencer
Set Phasers To Malky
#51 - 2012-02-22 14:38:28 UTC
I wonder if we, as EVE players, could start a trust where we donate money and the trust buys shares. Perhaps the trust would be managed by the CSM. That would give the CMS a lot more sway, considering it would be a shareholder...

However, I dunno enough about these things to say if that was a ridiculously stupid idea or not.

I have a specific comb for my beard.
Lexmana
#52 - 2012-02-22 15:00:53 UTC
I don't want CCP to go IPO more than anyone else. In fact, I fear it for all the reasons stated by posters before me.

But that doesn't change the fact that they will. They want to grow and they want to develop more games. It is proven by their actions in the past and nothing suggest they have changed their minds. Going IPO will give them the cash to expand without taking up big loans like they have done in the past. Going IPO will reduce the risk of having to lay off staff in the future.

After Crucible CCP has restored faith in their business which increase the likelihood of an imminent IPO.
Henry Haphorn
Killer Yankee
#53 - 2012-02-22 15:06:10 UTC  |  Edited by: Henry Haphorn
Eugene Spencer wrote:
I wonder if we, as EVE players, could start a trust where we donate money and the trust buys shares. Perhaps the trust would be managed by the CSM. That would give the CMS a lot more sway, considering it would be a shareholder...

However, I dunno enough about these things to say if that was a ridiculously stupid idea or not.


Several problems with that idea:

1. Who is going to oversee the funds and how do we know we can trust that person?
2. Even if a member of the CSM is assigned to handle it, can we trust that person?
3. Are there mechanisms in place to prevent fraudulent handling of said funds?
4. Will control of the purchased shares be transferred over to the new members of the CSM every year?
5. Do regulations of the market even allow a company to force the owner (or handler) to fork over the shares to his/her replacement?

EDIT:

I forgot to mention:

Typical shareholders always have an interest in making money with the shares they bought and sometimes tend to change the direction of the company (represented through the BoD) that will conflict with the interest of the players who have an interest in improving Eve Online (represented through the CSM).

Even if the CSM were to own some shares like the typical shareholders, this could create some problems.

Adapt or Die
Professor Alphane
Les Corsaires Diable
#54 - 2012-02-22 15:20:25 UTC
Doc Severide wrote:
W1rlW1nd wrote:
Gantz Tleilax wrote:
The Gonif wrote:


This might seem like an illustration that traditional CCP has already been experimenting with free-to-play in EVE, by allowing rich subscribers to essentially pay for others to play, in exchange for virtual currency — something that has been used by 40,000 people, the company says.


Can someone explain what this means? Rich subscribers paying others to play?



"Rich" player pays real money for own subscription, and plex. "Rich" player puts Plex on game market.
"Other" player buys Plex in game with fake money, and uses the Plex to extend subscription.

Thus, "Rich" player has paid real money for someone else to play, in exchange for fake money to throw around in-game.



Yep for all the people I helped to play for free, you are very welcome. Bought $4K in GTC's over the last 3 years.... I get Grind Free ISK, others who can't otherwise afford to play, get to play. Everyone wins...
Oh and for those who say "You could have spent that on other things", well I certainly did that too...



I don't really understand how 3rd party GTC transactions work, I know there are sites that sell them, but how do they aquire them and whats in it for them?

[center]YOU MUST THINK FIRST....[/center] [center]"I sit with the broken angels clutching at straws and nursing our scars.." - Marillion [/center] [center]The wise man watches the rise and fall of fools from afar[/center]
Jhagiti Tyran
Caldari Provisions
Caldari State
#55 - 2012-02-22 15:33:08 UTC
Razin wrote:
Jhagiti Tyran wrote:
Thorn Galen wrote:
CCP going IPO. Interesting but I hope not - not yet anyways. Shareholders have a way of changing the way a company works and maintains/sells its products and services. NEX would be upon us despite any protestations and golden ammo and "I Win" buttons would be for those able and willing to pay real $$$. Yes at that point in time, Eve would "die"

CCP + IPO = dangerous liaisons.


CCP already have enough shareholders that can throw their weight around if they chose to.

And this possible IPO may be just that.


Good point, either the current investors are unwilling to spend any more or they want to increase the value of what they already own.
Eugene Spencer
Set Phasers To Malky
#56 - 2012-02-22 15:36:11 UTC
Quote:
1. Who is going to oversee the funds and how do we know we can trust that person?


From my experience of Trusts (I was a chairman of a not for profit trust), you must write a constitution setting out the intentions and rules of the trust. In that constitution, you would say something like "the shares and any profits belong to the trust, not the individual members of the trust". So you set out all the rules of what happens. You could have the trust separate from the CSM but with a rule like "the CSM must use the trust for influence".

Quote:
2. Even if a member of the CSM is assigned to handle it, can we trust that person?


Perhaps it could be done voluntarily by someone with appropriate experience within the community. Accounts could be audited independently to ensure it's all above board. Or the trust could just pay for a professional to manage it. Just thinking out loud on this one!

Quote:
3. Are there mechanisms in place to prevent fraudulent handling of said funds?


Yeah - the law. Different countries have different laws and you'd set the trust up in the country with the most suitable laws for the trust.

Quote:
4. Will control of the purchased shares be transferred over to the new members of the CSM every year?

5. Do regulations of the market even allow a company to force the owner (or handler) to fork over the shares to his/her replacement?


No, as above, the shares belong to the Trust, not the CSM. Nothing would need to be transferred.


I have a specific comb for my beard.
The Snowman
Aliastra
Gallente Federation
#57 - 2012-02-22 15:36:43 UTC
I'm not sure this will be a good investment, to be quite honest.

Apart from the eve link, which I dont think console players will really understand, I cant see why dust would even be that successful.

it will land, it will be buggy and laggy, the next Modern warfare will release or battle field and players will move on. They dont stick with one game.

And they certainly wont pay £80.00 for a monacle.
0oO0oOoOo0o
Caldari State
#58 - 2012-02-22 15:42:10 UTC
Kewl !
If i buy a couple of shares, i want more attention to my proposal in the ideas forum by ccp !!Bear
Florestan Bronstein
Ministry of War
Amarr Empire
#59 - 2012-02-22 15:43:11 UTC  |  Edited by: Florestan Bronstein
Henry Haphorn wrote:
The Board of Directors and the Council of Stellar Management

If CCP Games does decide to file an IPO in the foreseeable future, how will this affect the CSM once a BoD is put together? I worry that with this combination, CCP could face a dilemma that is threefold:


  1. Chief Executive Officer wanting to use the revenue to improve the company (ie: new equipment, more employees, etc.).
  2. Chairman of the Board of Directors wanting to use the revenue towards satisfying the shareholders.
  3. Chairman of the Council of Stellar Management wanting Eve Online to be iterated on or expanded on meant towards satisfying the players who directly elected them.


This could become corporate schizophrenia if CCP files an IPO.

current CCP BoD is:

Vilhjálmur Þorsteinsson (chairman) - Meson Holding S.A.
David Fialkow - Teno Investments S.Á.R.L
Birgir Már Ragnarsson - NP ehf, Novator ehf.
Sigurður Ólafsson - ex- CCP marketing manager, now working for Novator Partners LLP
Steve Wieck - White Wolf co-founder
Hilmar Veigar Pétursson - CCP CEO

4 of 6 BoD seats are already in the hand of investors and a VC, that ratio would probably not change substantially post-IPO.
Not aware of the CSm having any contact to or issues with the current BoD other than Hilmar.
Nova Fox
Novafox Shipyards
#60 - 2012-02-22 15:46:19 UTC
Gantz Tleilax wrote:
The Gonif wrote:


This might seem like an illustration that traditional CCP has already been experimenting with free-to-play in EVE, by allowing rich subscribers to essentially pay for others to play, in exchange for virtual currency — something that has been used by 40,000 people, the company says.


Can someone explain what this means? Rich subscribers paying others to play?



Somone who originally wrote the article doesnt understand PLEX.

Dust 514's CPM 1 Iron Wolf Saber Eve mail me about Dust 514 issues.