Linden Lab Stock Sinks at SharesPost
by Pixeleen Mistral on 15/07/10 at 11:55 am
The return of Philip Rosedale as interim CEO of Linden Lab has apparently left real world investors unmoved, as offers to sell heavily discounted Linden Lab shares sit untouched at the SharesPost.com site. While SharesPost reports sales of Linden stock at $5.50 USD/share as recently as February 2010, current offers to sell stock go begging at prices as low as $2.50 USD/share – implying a dramatic 50% fall in valuation of the struggling virtual world service provider.
no buyers at $2.50/share
Sharespost specializes in matching buyers and sellers of venture capital-based private companies, and prices can be volatile, particularly for lightly traded offerings. However, the weak demand for even relatively modest amounts of inexpensive Lab stock point to serious problems for investors hoping for a liquidity event in the near term. The offer to sell 10,000 shares at $2.50/share has been open for at least two weeks, and additional offers at $3.00 and $3.72/share are also waiting for a willing buyer. At these prices Linden Lab’s implied valuation is in the $160-239M range.
This is in sharp contrast to the story one year ago. As recently as July 2009, one breathless analyst forecast annual revenues for Linden Lab at $100M USD and valued the company at $678-700M. Whomever is trying to sell half a million dollars of Series B Preferred shares for $5.00/share cannot be happy right now.
Could investor skepticism and the sliding valuation of Linden Lab played a part in the sudden replacement of M Linden? With SharesPost listing a valuation of Linden Lab at $ 140,900,000 as of the close of the last round of venture financing, it appears that there has been little wealth creation over the last few years. While some Second Life players remain hopeful that the return of Philip Linden will change the trajectory of Second Life, we wonder how much time he has before further drops in the company’s value push investors toward drastic action.
Father Jones
Jul 15th, 2010
There won’t change a thing with P. Rosedale, which means he will keep illegal gambling under a ‘game of skill’ cover will stay, which means they will keep earning millions of US$ on illegal gambling activity’s inworld, which means no serious investor will ever support this company full of crooks. It is going down anyway: in case they keep gambling alive they will keep losing their credibility and in case they ban all gambling (as they officialy did already in their TOS) they lose millions of US$ income which would mean another series of Linden employees getting fired,…
Down the drain it goes, which is very sad since all other beautiful content created in SL. I would cash out my Linden Dollars before it is too late !
Robert Graf
Jul 15th, 2010
When they started grandfathering/reducing tier for “preferred” oldies, and large estate owners they sealed Second Life’s fate. No one is going to invest in a business environment where their competitors are getting a minimum 33.3% advantage on tier. It’s that simple. Most people aren’t idiots. Why invest your heard earned RL money into a heavily manipulated and pyramid scheme like business environment. As long as unknowing noobs kept coming in this plan worked. Most people know now… Equalize tier for everyone and LL may pull out of the nose dive. Keep kowtowing to the 1% o folks who benefit from this and LL/SL is doomed. The greed of the 1% is what finished off LL/SL for good. ; )_~~~
Nalates Urriah
Jul 15th, 2010
Even venture capitalists can feel the crunch of the economy. Shares go up and down for many reasons. Whether these investors have lost faith in LL/SL or need money we cannot tell. With the blinding array of socialist legislation reforming the American business scene investor are simply not going to invest in businesses until it clear what the impacts are.
Whatever the reason for the stock sales and lack of buyers the price drop is not good. However the concept of a 3D web continues to move forward. Gaming and social networking continue to be profitable. LL has lots of potential. Whether they can realize it is another question.
Ajax Manatiso
Jul 15th, 2010
Checking my liquid accounts — I might but that
Bubblesort Triskaidekaphobia
Jul 15th, 2010
Nalates: The lab HAD potential. That ship has sailed with Khronos, Unity, IBM, Sun, the Web 3D consortium, et al. They have left LL behind and I don’t see them catching up any time soon.
If I were in Rosedale’s shoes right now I would kill viewer 2.x, make a 1.23 based browser client and open the server technology up a bit, connecting it to open grid and any other outside grid that is practical to connect to.
Why connect to other grids? Won’t that degrade the value of land in SL?
Yes, it would, but at this point the only way LL can keep the industry leading position they used to have is for them to become a VW equivalent of Google and PayPal wrapped into one and jettison their land operations. I know, it sounds crazy, but desperate times call for desperate measures. The only way to get more people in VWs again would be to make it cheaper to develop in them. Make it so people can run a sim off a cheap godaddy server and you know they’ll come running and transaction revenues will follow that zeitgeist. I think LL should go after that transaction revenue.
Think about it like this: Open grids can’t seem to implement search or monetization at all. Have them do their monetization and search through LL, then LL gets to keep the transaction costs from buying and selling Lindens, the transaction costs from Xstreet and the advertising revenue from search.
Granted, LL is horrible at search, but at least they have some kind of search in place. OG has nothing last time I checked.
That is what I would do, at least. What they will probably do is loose a few lawsuits they ought to win, offend and drive off more academics, hike their sim prices more, try to TOS lawyer content creators off the grid with more stupid restrictions against them making the very kinds of things that made SL as popular as it is, acquire modular systems and/or rezzable and kill half their big revenue earners with search updates (as it is, it’s obvious to anybody paying attention that they are stumbling around blindly with full rollouts of search changes without fully sandbox testing their updates).
Of course, all of this will be completely mismanaged, and the expected liquidity event will become a liquidation event before this time next year. I’m calling dibbs on the haptic feedback suit when the bank auction happens.
Emperor Norton hears a who?
Jul 15th, 2010
Hitler caused stock prices to drop.
Just saying.
All Seeing Eye
Jul 15th, 2010
No. The implied valuation of LL has always been at a certain level. Recently there was a doubling and that is over. What this event clearly demonstrates is how shitty and easily gamed sharespost is.
hobo kelly
Jul 15th, 2010
Wellsum, i sur wish sumone smart likem that thar Intlibber wud come along an’ splain to us all jus what them Lindens could have dun with that thar 400 million dollars that has gone missin in the last year…
doc
Jul 15th, 2010
@Nalates
i love it when americans speak about socialism.
You guys dont have any socialists in charge.
With the blinding array of socialist legislation reforming the American business scene investor are simply not going to invest in businesses until it clear what the impacts are.
you dont think they do that all the time?
Little Lost Linden
Jul 16th, 2010
I think the big problem with Second Life is the poor ATI video card support. I’m learning over at the Kirsten Viewer forum that things are still horrible for ATI video cards and Second Life. I just purchased a nice ATI card recently and have learned I am out of luck with no chance of ATI Second Life shadow support. Bummer.
Virtual Value on Shares Post
Jul 16th, 2010
What a joke. Start with Shares Post. It is as virtual a marketplace as SL is a virtual world. These are private securities with significant restrictions that cannot be easily bought or sold and to do so you must be a complete speculator since there is no requirement for the company to provide ANY financial information to the potential buyers on Shares Post. So the quality of the “market value” and offer and bid prices on the site are not worth the virtual ink they are printed with.
Jumpman Lane
Jul 16th, 2010
Sell and sell short! I BELIEVE a stock manipulation charge would do wonders 4 circulation! Let’s do it!
LOL
Jul 16th, 2010
@Little Lost Linden
“I think the big problem with Second Life is the poor ATI video card support.”
wow the lab got you trained good. Pass the buck huh? IMO the big problem with Second Life is the Complate lack of customer support from Linden Lab.
Pappy Enoch, Woebegone Felon
Jul 16th, 2010
If’n I won’t in jail I’d buy me a heap o’ that-there stock.
Buy low, sell high, my Pappy done telled me. I are high most o’ the time, so I don’t need to wait!
You reckon I kin buy me some fake world stock with S&H Green Stamps? I got me a passel o’ them what I traded for a ’68 Ford F-100 what did not run. Seemed like a deal until the judge telled me they don’t take no stamps for bail
Cooper
Jul 16th, 2010
@ Doc
You are an idiot
Darkfoxx
Jul 17th, 2010
Nalates: I think we can very well tell whether it’s loss of interest or money to waste: the drop in coorporate interest had already dropped nearly subzero before the world economy went on it’s ass.
SL is, as been proven, not really suitable for buisnesses to work with/in, the only real use it has, is advertising.
And for that it is worthless too.
General Drama
Jul 17th, 2010
Primary reason SL is NSFW: Too many dress up as animals and think that the primary purpose of a board room table is for yiffing.
In a business acceptable virtual world, if you want to be an animal, you can’t talk, you have to walk around on all fours, and anybody should be able to shoot you (i.e permanently kill your account) provided your species is in season.
doc
Jul 17th, 2010
@Cooper
Did i hurt your feelings?
Let me explain.
your democrats would be at most a middle party here arround. And your Repibicans….i think we dont have any party here that is so hardcore conservative like them.
thats why it sounds rally funny to a eurodude, when a american spaks about socialists.
It looks really weird to me. you can spand more than 300billions a year to fight against…what ever, but when someone wants to spend a bit monney to actually help your own people everyone is like OMG FUKKIN SOCIALIST.
you can call me a idiot as long as you want, those reactions are just dumb.
Sinead McMillan
Jul 17th, 2010
@doc
very well spoken! carry on!
Cooper
Jul 17th, 2010
@ Doc Seriously dude…You are an idiot
Darkfoxx
Jul 17th, 2010
@General Drama
Depends on what the company is about, whether their board room table is for ‘yiffing’. I can see how IBM would have a problem with it, but places like any of the adult furry clubs, yeah, that is the primary use for a board room table is teh sex.
But really, think away all us furfags… Is SL a buisness acceptable world then…? Hardly I’d say, other things you’d have to get rid of are any and all weapons, the whole Zindra continent, all the barbie dolls who only want to shop for shoes, all the blingtards, any and all traces of /b/, you, etc etc etc.
LL might be able to get rid of those, but for any buisness to have any use of it, they’d also have to fix all the technical problems. I think that’s rather unfeasable.
besides… where’d all the lulz be if there were no more furfags left? Think about it…
Pappy Enoch, Woebegone Felon
Jul 17th, 2010
I done been told I not only gots, but are a social disease…do that make me a socialist?
Alyx Stoklitsky
Jul 17th, 2010
>Digg
>Social Networking
wtfamireading.png
Jumpman Lane
Jul 18th, 2010
LL stock is acually onna rise! I checked!
IntLibber Brautigan
Jul 18th, 2010
@doc: Ah, evidently you haven’t been keeping up with the times. The eurozone currently has lower corporate tax rates than the US, and Obama last week lectured the EU that they needed to do more deficit spending to get out of the mess they are in, while the europeans are practicing fiscal discipline and cutting budgets. By these facts, the US is indeed the socialist state, operating by the same failed policies that ruined the USSR and were even disowned by Keynes late in life, while the europeans are operating much more like Von Mises economically.
While european states are denationalising industries and cutting welfare benefits, the US has nationalized its automobile and health industries, and brought its financial sector under even tighter central control. As a result, the US economy is dipping back into recession and given the increasing number of bank failures and rising unemployment (real unemployment, not the fake stats the government publishes that counts temporary census workers as employed but doesn’t count those who have stopped looking for work as unemployed, the real unemployment rate in the US is now 11.5%), we may see finally a drop into Depression.
For those who want to argue Marx vs Keynes vs Hayek and von Mises, I recommend you first read Amity Shlaes’ history of the Depression, “The Forgotten Man”, which demonstrates pretty clearly that absolutely nothing FDR did, no overspending, no regulating, got us out of depression, he actually made the Depression worse. It was only when he stopped doing those things and started listening to actual business people that he needed to reindustrialize for war mobilization, that the US exited the Depression.
Today the US won’t exit its economic woes until the anti-business socialists in the White House abandon their vendetta against the free markets, for the same reasons. Obama’s socialist policies are only making things worse.
IntLibber is a bad joke
Jul 18th, 2010
Hey Int, How’s that lawsuit going? Last I checked you where ban-evading as Overbrain Unplugged, chillin’ out with the Merczateers and ranting about Emerald devs peepin’ into your files while claiming you never violated the TOS (Cuz linden labs is nothin’ but thugs you know.)
So let’s here about politics!
Lynda Klossovsky
Jul 18th, 2010
LOL’s at Darkfoxx, Haven’t you been yiffed over the board table? Hey its a hell of a load of fun..
doc
Jul 18th, 2010
@intlibber
thats so mean, now i have to answer such a hard topic with my simple english. but let me try ^^
“Ah, evidently you haven’t been keeping up with the times. The eurozone currently has lower corporate tax rates than the US, and Obama last week lectured the EU that they needed to do more deficit spending to get out of the mess they are in, while the europeans are practicing fiscal discipline and cutting budgets. By these facts, the US is indeed the socialist state…”
Ive read about it and would also say, after all the money both, the us and the european countries throwed in their economy and spent for the bail-outs, its enough now, and cutting costs (at the right edges) would be the right choice for the moment.
on the other hand, there are many areas in the usa that where untendet in the past, and simply need to get fixed.
how do you want to cut health, wellfare, and education, if you allready spend way too little money on it?
i see that as a investment in the future.
Sure, that helps nothing at the end, if you have many very well educated people that dont get a job.
it would have to be found a way to make it easy for them to start new companies (we have that problem too, its just to risky for them to start something new)
“While european states are denationalising industries and cutting welfare benefits, the US has nationalized its automobile and health industries, and brought its financial sector under even tighter central control. As a result, the US economy is dipping back into recession and given the increasing number of bank failures and rising unemployment”
The car Industry is a mess, everywhere.
maybe its not officialy nationalized. but (for what reason ever) the goverments would never let them go down. same with the big banks.
Well, i cant answer the details, because i simply dont know them.
But from my view, regulations are needed, the last years made that clear. keeping a eye on hedgefonds, raise the minimal founds a bank has to keep and so forth.
if it has to be a 2000 pages thick law is another question.
But that will come here too for sure. They are just slower and the lobbys are really strong here.
in my eyes thats still far away from socialism. its a simple reaction on the irresponsible behavor of the financial industry in the last years.
im sorry if my reaction was a bit unfair.
but hearing someone speaking of socialism, that lives in a country that doesnt give a shit about its own people just sounded ridiculous to me and still does.
maybe its just a confusion of the word…
But i live right next to germany that had socialism, and trust me when i say, you are more than far away from that. even far away from acting social in a normal way.
Persephone Bolero
Jul 18th, 2010
@doc “how do you want to cut health, wellfare, and education, if you allready spend way too little money on it?”
The fact is none of these programs have worked. Why would you spend more money on something that doesn’t work? And the notion that they don’t work because we don’t spend enough money on these things and that’s why they don’t work is not backed up by the facts. Between 1960 and 1995, U.S. public school spending per student, adjusted for inflation, increased by 212 percent. Between 2002 and 2007, education spending increased nearly 70 percent faster than inflation. Medicare is the largest and fastest growing entitlement program available. And when Clinton cut welfare in the 1990s with his “welfare to work” programs, there was an enormous increase in upward mobility for populations in the program that had previously seen none.
“The car Industry is a mess, everywhere.”
Why can’t the government let them go down? If an automaker fails to produce a car that people are willing to buy, the bailouts force all of us to pay for cars no one wanted. So, what incentive would the automaker have to produce products people want? After all, they’re going to get your money whether or not you want their product.
“But from my view, regulations are needed, the last years made that clear. ”
This is patently false. W. Bush was one of the biggest regulators of all time. There’s this myth that he deregulated. He did not. The regulatory budget grew under Bush as did the number of regulations. In no way did he deregulate anything, especially banks. Then, a recession hits and everyone blames deregulation that never happened.
“that lives in a country that doesnt give a shit about its own people just sounded ridiculous to me and still does.”
Caring about people doesn’t mean throwing tax dollars at them. We DO care about people. And we know these policies are completely unsustainable and will make the problems much worse. Summing up the position of those that disagree with you with the glib “they hate people” broad brush is silly.
Socialism is just a word and there’s no way you can quantify a government’s level of socialism. I think such battles over what can and cannot be called socialism is pointless. Fact is, regulations have been growing steadily since Clinton (a Democrat ironically enough), and there’s not a shred of evidence that growing regulations have fixed problems. In fact, as I think we’d all agree, the economy is in pretty bad shape. If regulations worked, it wouldn’t be. Simple as that.
Gaara Sandalwood
Jul 18th, 2010
Oh god, it lives.
Persephone Bolero
Jul 18th, 2010
@Gaara “Oh god, it lives.”
You’re the guy who’s always talking about my comments being so rude, right?
Kiddoh
Jul 18th, 2010
“You’re the guy who’s always talking about my comments being so rude, right?”
No offense, but that could be anybody.
Persephone Bolero
Jul 19th, 2010
@Kiddoh “No offense, but that could be anybody.”
I know, where are my manners? Always disagreeing with liberals. How rude!
Ted
Jul 19th, 2010
Ah, and it turned into a political debate. The left and the right paradigm believing, and blaming each other, while not understanding that both are one and controlled by global elite banking institutions.
@Inlibber,
You wrote:
“Today the US won’t exit its economic woes until the anti-business socialists in the White House abandon their vendetta against the free markets, for the same reasons. Obama’s socialist policies are only making things worse.”
You are very confused as with many claiming socialism and socialistic policies being put in place by the current administration.
The merger of corporate and governmental powers is not socialism (egalitarianism), but rather fascism (merger of state and legal powers or govt.). State controlled capitalism is called fascism.
Straight out poor business practices doesn’t incite words socialism nor fascism. A pyramid scheme and fraud such as what we had witnessed within SL doesn’t necessarily incite neither.
Comrade Break-Dancing Stalin, Crusher of the Martian Hordes
Jul 19th, 2010
Haha you running dogs of the Western plutocracy make Comrade Stalin laugh, laugh! Revanchist cabals of so-called Socialism and Capitalism will all fall equally, smooshed flatter than black-wheat griddlecakes from Belarus SSR under collectivist-built steamroller of shining future of world communism! Half-hearted reformist impulses are but pause in pace of dialectical materialism on route to doom of bourgeoisie and faux-progressive alike. Provide your own shovels for graveyard party, YES! High-stepping Georgian comrades, Mustachioed Armenian fighters in Red Army, broad-hipped Ukrainian militant levies of former bakers, butchers, candlestick-makers now inducted into world army of Red triumph smirk, yes, smirk, and drink toasts of collectivist-made spirits while you squabble amongst yourselves in petty ghostdance of discarded ideologies soon to be enshrined in Museum of Pre-Utopian folly. All statist plans will perish in withering of state, YES and only one imperative will remain: I command you to DANCE!
Rob "N3X15" Nelson
Jul 19th, 2010
I see Second Life hasn’t changed. Still a festering dramapit that refuses to stop swirling about the drain.
/me goes back to autismcraft.
vince
Jul 19th, 2010
I hate every single one of you
At0m0 Beerbaum
Jul 19th, 2010
2006 is when SL jumped the shark.
“OH LOOK A REAL MILLIONAIRE MADE BY SELLING FAKE LAND! COME ON IN KIDS YOU CAN MAKE MONEY TOO!”
in came all the oppurtinists, typical corporate shills (who despite thinking they know business, often suck at it, and only keep thinking that way because they keep getting re-hired due to pure bs)
and everyone trying to make a quick buck.
Then of course, the company got drunk off of this newfound fame and fortune, and not surprisingly, abused it quickly, as many of the people running the show didnt know how to manage such popularity, it’s common with companies that grow too fast, they havent endured the long haul to the top, they took the elevator. Thus, they don’t appreciate, nor understand fully what they now have, and treat things as small time, all while acting like they’re big time.
Which is why the whole shebang has been unstable as hell since 2007.
Not to mention the people running the show also let manipulative and power thirsty residents get a lot of sway in the company due to either naivety or lack of caring.
Gee cant imagine why the whole system is in ruin. Hell, look how old this story is already, there isnt much to report on because when it comes to a dying game, there tends to not be much news.
ps: the idea of people grasping for power in a videogame, or using a videogame to empower themselves is hilarious.
Little Lost Linden
Jul 19th, 2010
Holy Moly!
It’s Monday, and I hate Mondays!
darkfoxx
Jul 19th, 2010
@ Lynda; Did I say I haven’t? :3
It's Unfixable
Jul 19th, 2010
@At0m0 – what would you have done differently? You’re all about bawwing over everything Linden Lab did to you. Let’s hear YOUR big plan.
It's Unfixable
Jul 19th, 2010
@NX315 – you too, Perplexie. You’ve spent years trying to take down Linden Lab and SL in general, and you’re getting a little frustrated that it hasn’t worked, and isn’t going to.
Let’s hear YOUR big plan. What would you do differently. And I’m not talking about “I woujldn’t do this or that”. Let’s hear what you WOULD do and why that would be better.
Ted
Jul 19th, 2010
@ Comrade Break-Dancing Stalin, Crusher of the Martian Hordes,
For those that did not read the above, what the person above wrote, please do read. There is truth in what has been said by this person.
Good for you, you do have knowledge of truth in your own understanding. May the most high through the revelation of the tetragrammaton bless you with greater gifts and even more understanding of what is to come.
While you may have written as a joke, I see the wisdom and knowledge in what you write. Good for you.
Pepper
Jul 19th, 2010
So a bunch of former employees (or at least one) who were recently fired are trying to sell their shares since the very thought of owning LL at this point makes them giggle. The question is always “How much is something worth?” and the answer is always “What someone is willing to pay you for it.” And apparently, no one was willing to pay the dead senior Linden(s) real money for their shares at $2.50 each.
Not sure what this has to do with Socialism, Fascism or yiffing on or under boardroom tables. More info like this, please!
Karen Palen
Jul 19th, 2010
Gee guys the reason *I* left Second Life was because it was no longer FUN!
Remember that? FUN – ENJOYMENT – ENTERTAINMENT
Something more interesting that washing my kitchen floor or cleaning my toilets! (Any volunteers? LOL)
I really don’t give a whoot about all the “socialist” arguments ro th e”content thieves” or whatever.
I will NOT pay money for something that is not FUN – PERIOD!
Linden Labs is Second Life’s worst enemy!
It's Unfixable
Jul 20th, 2010
Arguably true, Karen – though to date, nobody’s done any better.
By the way, N3X15 and At0m0, I’m still waiting for your big ideas. You like to run your mouths – let’s hear your Big Plan.
It's Unfixable
Jul 20th, 2010
Come on, “Pix” – afraid I’ve hit a nerve here? They don’t actually have any ideas, do they? The mask has fallen, then, hasn’t it?
Good job.
Wolf Baginski
Jul 20th, 2010
There’s something very unreliable about the value assigned to SL. No way are these shares being traded in a market. A working market needs active speculators, so that there’s always somebody willing to buy or sell. Arguably, modern markets have too many speculators, but that’s a different problem.
And 10,000 shares at $2.50 isn’t that much. It’ll be enough to buy an automobile. It easy could be a dead Linden. Do they have stock options?
In a real market, this would be a trivial deal. It would be happening all the time. And folk would know where to make the deal. Maybe, just maybe, this wait for somebody to notice is normal.
Gaara Sandalwood
Jul 20th, 2010
“You’re the guy who’s always talking about my comments being so rude, right?”
Nah, you know I love you Percy. :3
hobo kelly
Jul 20th, 2010
Vincie, you’re alive !!!