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"Investors buy the future, so help them chart the future," said Rett Wallace of Triton Research, which analyzes technology companies that have become public. "You can do it with Pinterest. You can not do that with WeWork. You can not do that with Uber or Lyft either. "
Charles Kantor, a senior portfolio manager at Neuberger Berman in charge of managing more than $ 5 billion, said he was asking a few simple questions when he was considering a remote placement. investments, including: Can a company's profit margins be maintained, what type of competition does it face and who can executives rely on to achieve results?
"Those we pass on, we are not comfortable with the answers we get," Kantor said. "It must be really obvious, very fast, they can grow up."
He has not yet invested in Uber, Lyft or Pinterest. But he bought shares of the Chewy online pet store, which went public in June. He said his profit margins, his large potential market and his strong management team were all reasons he had been persuaded to buy.
In many ways, the current confrontation between Wall Street and these giant start-ups boils down to a simple question: price.
Because of the expectations set by the venture capitalists, and taking into account the risks they face it, companies have simply asked too much.
Uber, for which private investors valued about $ 72 billion before its IPO, now accounts for about $ 54 billion in the public market. Lyft, which once had a value of more than $ 15 billion as a private company, now has a market capitalization of about $ 12 billion.
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