Experience «Twitter» bad technology companies keep away from the «Wall Street»

"Finally we finished!" This is what he wrote Anthony Noto, head of investment banking services in the field of technology at Goldman Sachs at the time, on Twitter. The Noto has helped to bring Twitter to the market and it was her first day of trading without errors such as those tarnished the initial public offering of Facebook in the process of the previous year. Not only this, but the stock jumped 72 per cent.

Since that day in November (November) 2013, became chief administrative and financial Noto in Twitter, the stock has suffered from the decline in long-standing. On Thursday it fell below the price in the initial public offering process. Noto has chosen not to publish his reaction on Twitter.

Company Twitter, has suffered a distinctive difficulties - slowing growth in the number of users, and questions about their ability to benefit financially from the numbers of their audience, and disorders of administrative - but the track as a public company is not uncommon for the operations of the initial public offering in the field of technology, and stands in stark contrast to continuing period of high valuations for many of their counterparts in the private sector.

It must be tempting to think that the company Twitter that he was able to remain a private company at the moment. The grass is greener on the other side and emerging companies, known as "Unicorns" - emerging companies such as upper valued at more than billion dollars - feed appetite it. Public markets bring more financial disclosure, and more public scrutiny, the more dispersed employees who inspect the eagerly stock index.

Rhett Wallace, co-founder of Triton's research, which focuses on the IPO process, says the distress felt by the public technology that newly listed companies should make executives are asking: "Is it logical that the companies that provide long-term public offering subject to market rapid trading algorithm that takes place in parts of thousandths of a second? ".

And it refers to the Castelaat Health Inc., which provides software to help companies manage spend on health care for employees, whose shares rose from $ 16 to $ 39.80 on the first day of trading in March last year, and is now less than 85 per cent. In the past two weeks, at which time it was probably Company executives on the beach, they held meetings on earnings reports - was sent analysts replacements for them - then traveled to attend two conferences of investors conferences in an attempt bring the soul in stock. Promotional tours never stop. Says Wallace, noting that the company could eventually fail, or succeed, but they need time to build a customer: "The Castelaat company may be the best example of the mismatch between the time horizons of the business plan and investor base. Growth financing operations in the market public risky. "

Businesses could understand that message. It has slowed IPO processes in the field of technology. According to Dealogic company data, since the beginning of the year so far it was only 19 process, compared to 46 by this time last year, although the broader market remained benign most of the time.

Kathleen Smith, president and CEO of Renaissance Capital, attributing it to a vicious cycle of weak demand among investors in the public sector is not strong boisterous circle of investors in the private sector. "Some people say they feel depressed because the companies have a lot of options and there is a lot of capital that flows in the neighborhood to stay in the private sector - and this is true - but I think that one of the reasons is that investors in the initial public offering are not interested. They do not want to see Pets .com other basic code share disastrous dot-com bubble in 2000 ».

Now, with the fact that the market in non-risk, most of the initial public offering last to suffer. There are a great example comes from a graph of the fund, which is traded on the stock exchange to the process of the initial public offering managed by Renaissance Capital, which outperformed comfortably on the broader market for most of the year until July (July that) when he fell to the lowest of Standard & Poor's 500 Index and sees Smith it is a quiet scale, indicating that investors can reduce the fund, which is traded in the stock market if they so value.

The weakness of the technology may affect the potential IPO processes in the field of financial technology, such as First Data's Land Square company, run by interim CEO of Twitter, Jack Dorsey. Perhaps the negative is also working on another objection inclusion of planned operations, such as Neiman Marcus, and Ferrari, and Olbertson, and Petco, and Seoul Cycle.

As for private companies and technology investors, some of them might be seen furtively over the fence Twitter they think that the grass is greener there; it was regret for not Aghtnamanm initial public offering process when the opportunity available to them.