Feeds

IPO makes VA Linux instant $10bn company

But one can't help starting to wonder why...

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

Yesterday's VA IPO turned into the biggest Linux hit yet, with the company's stock at one point zooming 800 per cent over the debut price of $30 a share. And that $30 had been a revision of a revision - VA Linux Systems' offer price had already been yanked up a couple of times in anticipation of greater demand than, er, anticipated. The stock fell back slightly (relatively speaking, anyway) later, but still left lucky company operatives dripping with virtual lucre. VA closed with a market cap nudging $10 billion, CEO Larry Augustin's stake and options make him worth $1.7 billion, and company director, general-purpose guru and "corporate conscience" Eric Raymond tells us in Linux Today this morning that he's now worth around $36 million. Eric* says it won't change his life, and anyway, he's the least rich of the director shareholders. VC backers Sequoia are the most rich, and Intel is sitting fairly pretty on a reasonable-sized VA share pile too. But when Linux IPOs are getting to this kind of level we're clearly approaching the point where worries about the bubble bursting are going to start to emerge, in the same way as they did with Internet stocks. Sure, Internet IPOs still tend to do well, but there's a general consensus that a some point there's going to be a reckoning, and the bigger Linux IPOs get, the sooner scepticism will start to set in. A quick reality check of VA, for example, gives us net revenues to 29th October of just under $15 million, and an operating loss of over $10 million. Eric Raymond alone is "worth" more than the company's total net assets, according to the balance sheet. So how exactly (or indeed, even approximately) will a company of this size justify a valuation in the region of $10 billion? How indeed... * Eric, bless him, says he might get a new mobile phone, a flute, cable Internet access and "maybe a nice hotrodded match-grade .45 semi for tactical shooting." Ah, the youth of today... Once upon a time the nouveau riche destroyed themselves in orgies of drugs, smashed hotel rooms and Rolls Royces in swimming pools. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
Lords take revenge on REVENGE PORN publishers
Jilted Johns and Jennies with busy fingers face two years inside
Yes, yes, Steve Jobs. Look what I'VE done for you lately – Tim Cook
New iPhone biz baron points to Apple's (his) greatest successes
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Edward who? GCHQ boss dodges Snowden topic during last speech
UK spies would rather 'walk' than do 'mass surveillance'
YARR! Pirates walk the plank: DMCA magnets sink in Google results
Spaffing copyrighted stuff over the web? No search ranking for you
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.