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The Almighty Buck

Could Mandrake Sell Stock To Users Who Love It? 158

An anonymous reader writes: "Tech stocks are in the toilet and the word Linux makes investors curse right now, but Mandrake is talking about an IPO. Business writer Jack Bryar suggests a way Mandrake could go public in spite of Linux's bad rep on Wall Street: by selling shares to loyal users the same way the Green Bay Packers sold shares to local football fans who wanted to 'be part of the team' but didn't necessarily expect to make a profit. Do you think enough people love Manrake enough to make this work? I might buy $1000 worth myself if they did this, just for the hell of it. Would you?" It's an interesting idea, not necessarily limited to Mandrake either, though that does sound like a good first candidate.
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Could Mandrake Sell Stock To Users Who Love It?

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  • by Anonymous Coward
    I have an idea. Why don't we actually just *buy* the companies product first, instead of paying chunks of money for the stock?
  • by Anonymous Coward
    My reason would be that I like Mandrake for the direction it's going: Making a user-friendly distro that can be used by novices on up. If any distro will compete with windows it's Mandrake. (or maybe OS X) I think Linux is a good OS that could compete if it had more apps and was tightened up on the UI side. In other words it's a good cause and I'd like to be able to help it happen any way I can.
  • by Anonymous Coward

    First: any company -- public or private -- can issue shares to anyone they want. I can be a private company and offer shares to whomever I want. Anyone who has ever launched an S Corporation -- which, apparently, includes none of the wankers involved in this discussion -- knows that at the time of incorporation you determine how many shares compises the company and who should own them. If Mandrakesoft wanted to, they could offer shares privately. Going public means that shares are traded on an exchange.

    Secondly, Mandrakesoft already accepts contributions via PayPal. Betcha $1000 not a single slashdotter in this discussion who says that they'd invest in Mandrakesoft has actually contributed in this manner. You CAN put your money where your mouth is. Mandrakesoft reports that there have been fewer than 40 contributions via PayPal. Fewer than 40! Lotsa big talk around here, but there's little followthrough.

    Thirdly: Green Bay Packers shares are sold as limited shares. If the team moves or is sold, all the proceeds go to the local VFW and the shareholders are screwed. (Really.) Personally, the thought of dismantling Mandrakesoft and distributing the remains to a local VFW does have a certain appeal....

    Fourth: RED HAT ALREADY DID THIS. How quickly we forget. When Red Hat went public, a certain percentage of shares were set aside for the community. For this, Red Hat ended up in court. I am sure Mandrakesoft would really love to end up in an American court as well. Those who forget the past are condemned to repeat it.

    Slashdot should quit linking to dumb things on their sister sites, and they also should disclose when a link exists just to drive traffic to a really lame OSDN site.

  • The industry insider knowledge that you have can come back and bite you in the ass, though. Take Rambus, for example. They have the patent on arguably the best memory chip design on the market. Intel has declared that the P4's roadmap will only run with DDR for a short time, but RDRAM and the P4 are joined at the hip. Then you look and see that Rambus not only has patents on RDRAM, but also on SDRAM and DDR-RAM! Sure, they came about them in a little underhanded way, but when has underhandedness ever been looked down upon in the software world (*cough*Microsoft*cough*)?

    Now you've got a company that holds patents on every viable memory type for personal computers. You know that PC's are selling like hotcakes and that means memory is too, which all boils down to huge royalties for Rambus.

    But that isn't what happened. Rambus decided that they wanted to play the heavy and tried to roll every memory maker on the market. A little business sense would have told you to get the hell out when they served papers to the likes of Siemens and Hyundai. Business is about more than just technical superiority, it's also about getting along with those you exploit.

    RDRAM may be the superior memory architecture, but if you invested for that reason, you may be getting your lunch handed to you.

    This is just one example of falling for a company's product and stock, but there are countless others.

    It makes sense to limit your individual stock purchases to those areas you have some special knowledge about, but if you fall in love with a stock like PALM or RHAT or LNUX because they mirror what you think, you may be screwing yourself.

    Remember, there are a lot of people making money on MSFT stock.
  • I'd consider buying 500$ worth @ .15cents per share, then sell at .60cents, there best bet is the otcbb, after all, thats where msft started.

    The desktop is dying and the future is embedded devices for your clients and 64-bit servers. Why would one dump alot of money in a company that current plans are dominate a market which is dead as a doorknob, ie.. x586

    But the "peoples os" may find a bright future into embedded devices, seeing that linux is gplfree!

  • by Eccles ( 932 )
    I'd feel dirty donating money to a for-profit company...

    One thing I've wondered about is whether it would ever work to buy "stock" in a person. I program professionally, but if 10,000 people contributed $100 (or some similar number), I'd quit my job and work on open source for the rest of my life, living on the investment proceeds. And the payoff for the investors would be the code I produce. Now, you don't know me from Adam, but perhaps if it was a "name" person (say Alan Cox), where previous rep was sufficient to spur investors, this might work. And perhaps if a few people were established this way, it would provide enough of a boost to add less well-known but competent and hard-working folks (like me) with recommendations, possibly with referenda on each person so hired each year where the investors judge whether the person has done enough in that year.
  • There's a big difference between investing in open source and investing in a company. If you want to invest in open source or free software, send your money to a project (FSF, KDE, GNOME, whatever). That will put your money where your mouth is. Purchasing shares of a company isn't the same as supporting open source. Mandrake may produce open sourced software, but if you look at the facts of the situation you'll see that Mandrake is the ONLY company that uses its open source software. So, by supporting Mandrake's open source software, you aren't supporting open source in general. You're just allowing them to produce open source software and sell it (and make money from it) without having to dip into their own pockets.

    Believe me, this is one snowball that you DON'T want to start rolling downhill. If every company that produces open source software holds it hostage until you all fork out $$ for it, you'll be in a world of hurt. Consider all the apps that are on Mandrake (or any other distro for that matter) that are produced with corporate backing of some sort, and you'll see how quickly your wallet may be depleted. When it's one company doing this it seems manageable; when it's hundreds, look out.

    Make your money go further and invest in projects and "non-denominational" causes if you just want to support the production of open source software.
    If you want to play with stocks, play with stocks. Gamble on the success of the business you're investing in, but don't invest as if this one company is going to be the savior of open source software (or as if NOT investing will cause the company to stop producing open source software. If that's the case, they must not be taking their open source stance as seriously as they should).
  • $200 for a nice looking certificate to hang on your wall proclaiming you as a Packer shareholder and lifetime admittance to the annual shareholders' meeting at Lambeau Field during the summer. If you are a true Packer fan, it isn't a bad deal, even if it will never make you rich.

    I don't know if Mandrake's following is quite so loyal though.
  • That would be the point, to support the company. That's where your money would go.
  • This is _not_ donations. How on Earth could buying ownership of a company be considered donations?

    Investment that is entirely profit-motivated is unethical (i.e. - you shouldn't invest in a company which does things you believe are immoral, and you should always check to find out. This pretty well rules out mutual funds).

    Anyway, this is a great idea. Why? If you were a big company, wouldn't it be nice to own a piece of Microsoft? Owning the companies that supply your daily needs can be very beneficial.

    Anyway, just my 2 cents
  • Actually, they might not have to follow those restrictions. They might be able to do this and be privately traded. Also, since their French, I don't know how that affects the rules.
  • .. or something like that, like a business reply card that gets you a share when you return it.

    Make it part of the product reg.

    Or not.

    Your Working Boy,
    - Otis (GAIM: OtisWild)
  • Hm.

    "I'll buy 100 shares if you put wxWindows and wxPython in your distribution."

    Hm.

    ObJectBridge [sourceforge.net] (GPL'd Java ODMG) needs volunteers.

  • It's been said that the lottery is a tax on those that don't understand math. I'd say that casinos are a tax on those who don't understand probability and statistics.
  • Well, they both apply, but here in Canada to collect your winnings you have to answer a skill-testing mathematical question.
  • I should 'donate' $1000 to this company to support 'free' software and the good work they do? Sounds good.. While I'm at it, anyone know where I can buy some 1 dollar bills for about $20 each? I want to show my support for the good work the US mint does.

    Go ahead, say that I 'dont get it'.. I think I do get it, and I think the recent plummeting of all these dot-com and linux stocks shows that the rest of the world is 'getting it' now too.

    Here is an idea for Mandrake, market a product or service that is better than the free one, and charge people for it. Wasnt that supposed to be the way for OSS companies to make money?
  • I am not a financial/banking person. I was wondering
    for a while what an underwriter does. Why can't
    you go public by selling your shares e.g. at a kiosk
    at an airport? You sound like you could answer
    that question.
  • Depends how much the shares go for at IPO. It's worth a shot...
  • This is rediculous. Who is going to throw away money to a company for no reason? This is totally different than the Green Bay Packers stock offering. Green Bay Packers are publicly held by the city of Green Bay. They wanted a new stadium to keep up the revenue, they offered stock to pay for it. They did not make enough in stock, they then set a sales tax increase, now the fans got their new stadium, what do we get out of Mandrake? Just another release...give me a break..
  • by Irie ( 21539 )
    What if I can't code my way out of a paper bag (and yes I work with people that dream in code)...

    Or say, for example, that in the course of being a busy sysadmin and father I dont have the time to contribute documentation. Wouldn't it be cool if by sending them a benjamin I could be contributing enough that I'd get stock in my fave distro?

    After all isn't that why we have money: to exchange for goods and services.

    If enough people contribute a hundred bucks, there will be money to pay for someone to code. The real question is not HOW you contribute. It's whether actually DO contribute. Do you??

  • Every six months, the software could shift into fund-drive mode, and urge uses to donate. "Volunteers are standing by!"
  • People like you suck. I'm sorry, I don't mean to troll here, but really, did we catch you in a bad mood? Do you really mean to tell me you've never pulled over on a road trip to see that 3000 lb ball of yarn, or pay 15 smacks to get into "Bedrock" Arizona? [It was a riot, and 15 bucks well spent.]
    Life is not about business, and no one in the world will have his epitaph say "I should have spent more time at work". Personally, I'd buy it just to show off how much of a geek I was to my fellow Marines. Because I'm bigger. ;)
    Sgt_Jake
  • You're logic implies that mandrake is worth $600,000, and you base it on the fact that other linux stocks (RHAT) are around $6. But market cap determines how much a company is worth, and using the following metrics here's how much each share of mandrake would be worth:

    If Mandrake is worth 1/10 of RedHat, and offered 100,000 shares, each share would cost about $918! That would net them $90 million dollars!
  • This was suggested when Commodore first hit the ropes. Fans buy shares because they like the company/product, not because the management have sane or sustainable business model. Commodore went down the toilet anyway, though I don't think many people bought shares.

    The problem? The management continues the do stupid things because they know the shareholders are not expecting to make a profit anyway. OK, maybe they won't, but I'd not be expecting any kind of returns if I bought shares.

    One company here is having all sorts of problems because its shareholder base is too fragmented to shove the current board.

    I'd much rather put my money into things like Debian donations than propping up someone's profit making concern.

    How about setting up a mutual society? A publically listed corporation is not the only company model out there and I think some of the other ones might be better for Linux development.

    Xix.
  • I second that emotion.
    Nice to see all this on /. I use, love, and will buy stock (1 share). All this BS about not making money, charity, illogical investing, ... I see in the threads here, Rave on! my fellow /.ers; you just don't get it.

    sig hasn't been updated. I run M/LGX 8.0.
    Mandrake 7.2 and KDE 2 for me? for free?
  • What's with all these articles with the "Hey, wouldn't be cool if we all gave Mandrake some money?" Could there possibly be some shared interest with the Slashdot crew?
  • We (I grew up and still live here in Wisconsin and consider the Packers to be God's own team) might have the smallest stadium, and middlin' revenue, but the Pack is still one of the most successful teams ever. You certainly can't say that about a team located just a little bit west of us... As for the Mandrake stock thing, hell yes! I _really_ like the distro and want to see them continue. I believe that Mandrake will be the distro to conquer the desktop. I'm running 8.0 on one of my workstations and my laptop right now. Gotta love it!



    Dive Gear [divingdeals.com]
  • Mandrake is a friendly end-user oriented distribution. It makes sense that they would look to their pleased customers for support. I'll invest-- I've installed 8.0 on both home and work computers and am very happy. Good for novices like myself. Of course, the v.0.02 software without the configure files are tricky to install, but I'll figure out how to get the lib and include paths right one of these days.
  • I've thought of this, with an application to individuals. I call it True Human Capital [home.net], where you invest directly in people with hope of a future return. In theory you could create a "mutual fund" for an open source project and contribute to the people involved that way. Would it work? I'm not sure.
    --
    OliverWillis.Com [oliverwillis.com]
  • While I don't doubt Packer loyalty, they have one of the smallest stadiums in the league and rank at best in the middle of the league in revenue.
    --
    OliverWillis.Com [oliverwillis.com]
  • This sounds like a good idea to me. I can't program to save my life but I love Mandrake and would like to see them survive in the long run.

    Mandrake 8.0 is a fantastic product and is IMHO almost there when it comes to competing with Windows for the desktops of the world.

    I've been using Linux since '94 and am very impressed by how far it has come. Back then it was Slackware or roll your own, not that there was much difference ;-), and today you can mass deploy Linux on a LAN using a GUI tool that is easier to use than the corresponding tool for Win2K.

    Oh, and please don't tell me Mandrake is for newbies only, like that review on Attrition.org. That is just posing and self-important BS.

    Go Mandrake!

    Gunnar

    --

  • Just for clarification.

    The Green Bay Packer stock was a complete scam. To say people bought it not expecting to make a profit is not correct. There was NO way to make money on that stock as it was a novelty. On the piece of paper the stock is on the fine print indicated that the stock gets you zero stake in the company and does not entitle you to dividends.

    As it stands if the Packers became some multi national hellacious megaplex of a inter plantary conglomerate, the people with that stock would not see one red cent from that stock.

    ft
  • I'm sure I'm merely echoing what a lot of Slashdotters feel, but I know that I would buy stock in Mandrake like this. Like Timothy, I could probably afford a grand.
  • Yeah I probably should've actually read the story before I posted anything about it. I'll be keeping my grand, thankyouverymuch.
  • why did this get modded down? isn't this a valid question? maybe mandrake should be pursuing donations for continued support, rather than worry about being publicly owned. seems to work ok for the *BSDs (i know i'm not the only one donating to OpenBSD and FreeBSD).
  • Stock ownership is the one way to have your cake and eat it too. The money doesn't "go away" as it does when you buy a boxed distro; it becomes capital, it earns dividends (well, that's the idea...) and next year you can take it all back and put it to work somewhere else.

    Always assuming the company hasn't gone under, of course....

    I like Mandrake, and even though I don't own ANY stock at the moment, if this actually happened I think I'd make an exception for them.


    --

  • Cowboy Neal must keep him coming back B-)
  • As I recall, the idea didn't work so well for the Packers. They had to extend the purchasing deadline at least once because the stocks weren't moving.
  • Come on guys.. we all love Linux, and want to see companies that are helping to advance it succeed. But, propping up linux companies will do no good in the end.

    Like every other for-profit company, they need to compete in the open market. They will win or lose based on the merits of their product, their marketing, economic factors, etc. Saying that the need charity to survive is sort of insulting to Linux.

    Like many other Internet related sectors, Linux companies were started and grew with irrational exuberance in the last few years. Like all those Internet companies, the ones with no chance of competing in the open market will fail. This had to be expected. This does not mean Linux will somehow die. It means that Linux will evolve. Some projects will die, some will return to their roots as community projects, some will get swallowed up by larger corporations, and others will flourish on their own.

    If a Linux company wants community financial support, it should be set up as a non-profit company, and donations should be tax deductable.

  • --A big heavy metal band of the 80s was Iron Maiden. Iron Maiden would release an album and it would shoot up the charts and go platinum in a week and then the album would plummet off the charts never to be seen again.

    --Iron Maiden made the real $ off of touring & merchandise (they had a mascot which helped merchandise sales greatly.)

    --Mandrake would be in the same boat. But of course Mandrake couldn't go on tour (could they?) Worse for them is that I don't believe they're the most popular distro. So how well could this idea actually work?

    --In any event using your "fans" as a business model is a really stupid idea.
    ---
  • Perhaps Mandrake will give you a cool black T-shirt with all the contributors names on it for your $.
  • Actually, since the Packers are non-profit, they really don't make money. It really wouldn't be a BIG difference anyway since the stock offering is basically an elaborate fundraiser. Packers were smart in doing this decades ago, and offering shares again a few years ago. Go Pack! :)
  • And the SEC imposes a limit of $1 million on the entire deal.

    Its cheaper since the firm and their underwriters don't have to file paperwork in all states where the stock will be issued to the general public.

    Thats the good news.

    Bad news is that prospective investors must be "accredited"; under SEC regulation D section 501, you must have either a net worth of $1 million, or an annual income of at least $200,000 for the previous two years (and a reasonable expectation of this income continuing in the near future).

    And before you piss and moan, its all done to protect the "little guy" from fraudsters and such (by no mean implying the good folks at Mandrake are of such ilk).

  • This is the typical kind of thinking of all companies nowadays... a good idea is all that counts, don't worry about a good business plan. Gee the money will come from ether!?!? When will they ever learn? Sneaks
  • Most people see the word investment and immediately think of it in terms of economics: an investment is property or another possession acquired for future financial return or benefit. On the other hand, this situation seems to invite another definition of investment: commitment, as of time or support.

    If I were to buy into Mandrake in this way (not necessarily saying that I would), my reason for investment wouldn't be for financial gain. My investment would be to offer support to the company so that they can survive the current unstable market and continue to provide services to the open source community in the future. The more people we have working full time on open source software, the better it is going to get. As open source software continues to improve, it begins to look like a much more valid solution to companies interested in any sort of software investments.

    Most likely, I won't make a dime from such a purchase, but I can be assured of one thing in this situation: my investment would help support the open source movement in general by supporting a company whose direction and business model I agree with. I find this much more satisfactory than investing in a company with a business model and business practices that directly oppose what I believe in, in the name of turning a quick buck.

    Devolver
  • i own win95, 98 and NT4.0
    i've used mandrake 6.0 - 8.0
    mandrake has been more fun than windows, it's been just as useful, yeah, it's worth it.

    thing is i don't mind spending my money on product provided that product is good. i've paid for windows only b/c it's the right thing to do. sure i bought NT4.0 with a student discount, but i'm not into stealing.

    i prefer mandrake to windows and it's just a perk that i can get it free (cheaply). however, if they don't get any cash for it, the likelyhood that it's development will slow or stop rises. yes, mandrake is a product, a good product, and it's worth paying for. i think that somewhere down the line i need to show my grattitude and give something back.

    if nothing else, it's like saying "thank you"

  • I don't understand the above view about donating money to private companies. If I am going to donate to something I want it to be used for a specific purpose other than profit. I'm not putting down Mandrake. I think it's a great distro. I just think that when you give away money to something you have a right to at least help decided how it ought to function. I feel that companies are an in appropriate venue to give charity. Mandrake should be concerned about their bottom line not soliciting or accepting donations. What will happen when they do something that we don't like? Boy will we be pissed then!! Am I the only one that sees this as a bad idea?

  • I wouldn't exactly buy a product just because I liked and understood it. The idea behind stock ownership is that you are buying a piece of the company with the expectation that you will profit. When you buy stock liking it isn't good enough. You also have to take into account what the price is for that piece of the company. What about how the company earns? Or its potential to earn? It's sectors outlook in the market? If Mandrake has a economic outlook that suits you, then buy it! But don't just contribute money to alleviate guilt! Keep in mind this is a for-profit firm. Invest if you want, but don't contribute.

  • I want to own stock in companies that I believe in. I really do. But stocks appear to me to have little to do with the *company* and so much more to do with the *market*. If I buy Mandrake stock and Linux comes into favor on the stock market again, my stock goes up. If it goes out of favor, it goes down. There's little connection to whether or not Mandrake is delivering quality products to its customers, which to me is what a company is all about.

    If there was a way I could own stock that directly reflected the success of the company rather than the ebb and flow of the market, I'd do it in a second.
  • The Green bay packers thing asside. It costs a huge amount of money to go public, and the people who you need to buy your stock are not a bunch of geeks who will buy a few thousand dollars of it, but managers of mutual funds and pentions etc. Those guys will buy $20 million in stock in something if they think its a good deal, even a long shot good deal. Those guys really want to see numbers saying that they are going to make money. Because thats their job.

    And hell I wouldn't drop $1,000 on a stock if I din't think I was going to make money. I make think the Mandrake folks are cool. But If I have a spare $1,000 sitting about, I'm probably going to use it to pay off some of my mortgage.
  • The problem is that I want some companies to continue following (what I consider to be) ethical "rules". In particular, I want Red Hat to continue to release code they develop themselves (e.g. RPM) under the GPL, and I want them to continue not including proprietary software in their distribution. And I don't want Google to start selling search result rankings. And so forth.

    Sure, owning a little stock won't give me much say individually, but possibly if a lot of users owned a little stock...

    Danny.

  • umm, if you love a company, and you want it to continue on its merry way, you want to funnel as much resources into it as you can... Stocks are a way to do that.

    you aren't doing it b/c you think it is neat, you are doing it to give them more money.
  • Programmers and other high-tech professionals are among the most highly compensated people in the world, especially in the US. Vis-a-vis teachers, academics, many scientists, social workers, those of us in this industry can make more money on our own terms by an order of magnitude.

    Yet we are turning to what is virtually a charity model to support the companies who are producing the things we like, even as organizations who provide services to the have-nots and disadvantaged go begging in silicon valley. Is this sector myopia, fanboyism, or something else? Maybe the dog-eat-dog ethic of the 90's has created a contempt for non-profit professional efforts. Is there a problem with focusing Free Software development in a .org context if acting like a business isn't working? Why give money to Mandrake (or VA Linux, for that matter) instead of to the FSF or one of the BSDs or other projects, or an educational institution, directly?

  • As far as I can tell, just because Mandrake is selling their stock doesn't mean that is has to be publicly traded. In fact, shares of the Green Bay Packers are not listed on any exchange that I know of.

    The idea, I suppose, is not so much that one buys Mandrake stock as a financial investment, but that one buys Mandrake stock in order to (1) financially support and maybe (2) have some power for directing a Linux-friendly company.

    ObJectBridge [sourceforge.net] (GPL'd Java ODMG) needs volunteers.

  • I'd like to see it so each time I buy a Mandrake product I get a certain amount of stock with it. I can't afford to spend $1000 on stocks but I would be willing to buy boxed sets, manuals, tshrits, etc which I usually wouldn't if I got the stock too. This would essentially make it a customer owned company. Along with giving stock to employees and opensource developers I think this would create a net of interest in the company that would not be likely to sell off on a whim as the average investor might.
  • Stocks are supposed to be long term investments. Even though there are day traders and people who trade regularly from a company perspective they are long term.

    Example: If mandrake were to stay private, people who work for them would probably get stock options. Each year based on how well they are doing they would go up in value. In the end you may double what you paid for them, but it may take twenty years.

    The only real way to make money off of stocks is to watch for those low buys and high sells. Personally I think that the stock market is overrated.

    The reason all the dot coms failed was because people were jealous and wanted them gone! Be careful what you wish for you may get it...

    I don't want a lot, I just want it all!
    Flame away, I have a hose!

  • OK, ALL else aside about how to do this, IPO status, etc. this is an interesting idea for one thought:

    The idea people may invest without expecting a financial return, the idea of using money to support something instead of your own profit.

    This opens up a lot of other interesting ideas as well - can companies take charity or donations (how much money could a Linux company raise if it took donations from various Penguinholics . . .). Can an Open Source company be reconcieved of as something other than the usual corporate concept?

    Coming down from the blue sky, one simpl barrier I see, beyond the questions of proper procedure, is greed. A site I do some admin work for offered people a chance to donate some money and get some extra features as a gift - and prompty some ignorant a$$ argued about "getting his money's worth" without understanding that sometimes an idea is worth supporting . . .
  • Well, if they did this, I might buy a couple hundred dollars worth. Not that I would expect to make money anytime soon, or maybe ever, but because I like Mandrake.

    The reason it's different from donations is that presumably, as a stockholder, I would have some input into the direction of the company. Maybe they could have shareholder voting on company direction questions over the internet - one vote per share... like, should we make Mozilla the default browser in Mandrake 8.1? Should we continue shipping proprietary software in the boxed version? Should we hire more developers? What should the developers work on? Of course, as a private company the CEO is ultimately responsible, and shareholders can really just vote to replace the CEO and board. Or something, I'm no expert on corparate law, especially for a French company.

    But anyway, my point is that it would not be just a donation to Mandrake.

    If this is really successfull, Mandrake might end up kind of like an incorporated version of Debian, just as user/shareholder-driven, but with a better installer and less politics. (/me grins, ducks flames...)


    Torrey Hoffman (Azog)
  • It's an interesting idea, but I don't think it will fly. Most geeks make pretty good money ($30k - $100k/year). These people could buy $100 or even $1000 of stock and not have to eat ramen (but might eat ramen anyway). What could make this idea sucessfull are big money investors. The big money geeks can afford to invest $10k or even $100k without the expectations of significant returns. But the number of millionaire geeks has plummeted in the last year (Hi Rob). Without them, I don't think this idea can work.

    -B
  • The issue of buying stock in a company is to purchase the stock at a price with the expectation (or gamble if you will) that the company's stock will be worth more in the future.

    Now I've also seen posts that recommended just donating. Well, if you're content to donate money, that means that you're content to shell out a certain amount of cash with no expectation of a return on that investment. In that case, why NOT buy stock in the company? If it completely tanks, hey you were content to lose it all anyways. But if it succeeds, your faith will be rewarded.

    I don't feel linux companies suffer from the same rap as a lot of the dot com companies did. Linux companies, for the most part, actually HAVE A PRODUCT THAT PEOPLE WANT!!!!!! The problem was, with the collapse of all the worthless dotcoms, the linux companies were effected as well because the industry as a whole took a nosedive. There were no cashhappy corps using linux boxes, purchasing network equipment, etc, and the ripple effect affects the entire industry.

    But the strong useful companies can survive. Investors may be wary, but to hell with them. Companies can survive without investors and they're better off in the long run if they have a business plan that does not rely in whole or in part on a large quantity of infused cash. Meaning, the company survives on its own revenue stream. Imagine THAT of all things! :)

    -Restil
  • You are taking the 'Righteous(sp?)' approach. But let me tell you why 'just linux' won't fly (atleast for me). In my current box, Linux Mandrake install is about 1.5G. Linux kernel itself is what around 50Meg, maybe. What I am saying is Mandrake put in a lot of effort tying all the pieces together and put out a very nice distribution so anyone (well almost) can use it.

    Gone are the days, where you have to
    - ask experts about partitioning your harddrive
    - dust up that monitor manual and lookup the supported frequencies to get X to work.
    - Tweaking the Xconfig to get the right colordepth or mouse working.

    Now I can install mandrake
    - in 20 mins
    - without manually adding any 'device recognition'
    - and have Kde running with Anti Aliased fonts in a very cool desktop.

    For me that is value add. sure I can download X and do a 'make World' and QT and Kde...etc. But my time is more worth than anything, and I would rather buy a polished distribution to get me past the install.

    Okay given all that, I doubt I'll ever depart from Mandrake anytime soon, as long as they continue the current trend. I just donated some money throught their donation page. I'd love to own a piece of the company b/c I know some day they are going to be great. And who knows, I might even get a return on my investment.

    I don't buy into the notion of 'these companies are ripping off customres to ship linux which is FREE'. The value added in a distribution is 'real value for me'

    man that was a long whine :-)

    LinuxLover
  • There are a million methods of choosing stocks, but the questions you asked at the end of your post are the wrong ones. They lead investors down the dark path of falling in love with their stock.

    Perhaps, perhaps not. Why would I invest in something that I have absolutely no clue about? (If I was buying stock that is - bonds, mutual funds, etc would be different). I invest in industries that I have extra information about - industries in my field. Palm is an example of this - they were horribly overpriced, and I identified that. They're not so overpriced now, and their APIs and programming support are above board. I've used them in many projects. So I buy the stock because I expect the product to grow and hence the stock price to raise, making me money. I'd be stupid not to take advantage of any specialized knowledge I might have as an engineer.

    The question that I've found useful is not those that you mentioned, but this simple one: "If money wasn't an issue, would I buy this entire company (Price x # of shares) at this price?"

    Obviously, that's a good metric, and one that I use. But I don't invest in companies that I don't understand, either. The point of me investing money myself is to capitalize on technologies or fields that I have specialized knowledge in. Other people might argue that.

    Palm, RedHat, Amazon.. yes, at their highs, they sure did. But at a few bucks a share (and slashed market caps), I'm willing to gamble a couple thousand on my gut instinct and experience. It's only money :). (Well, I wouldn't TOUCH amazon, because I think online selling is crap, I like buying stuff and getting my paws on it right away :). But that's my opinion. I made out like a bandit on AMD - I bought them when they dropped because I knew their chips were the best out there, and they were what I used, and everyone I knew used - and I've been rewarded for that.

    Ymmv, of course.

  • If Mandrake has a economic outlook that suits you, then buy it! But don't just contribute money to alleviate guilt! Keep in mind this is a for-profit firm. Invest if you want, but don't contribute.

    Scared of us dirty hippies undermining the stock market with altruistic motives for investing? They are a for profit company, but they are different in that the end product is something that I'm free to do whatever I want with. That can't be said for any closed-source software company, and the same metrics don't apply IMHO.

    If I buy the stock, I reduce the supply, and hence will raise the price (maybe not noticably, but in volume...). By keeping the price up, you keep the companies shareholders - of which you are now one - motivated and optimistic. Mandrake would be issuing the stock to raise money afterall! (and you would be buying in hopes of getting SOMETHING back). If that something is another version or two (or dozen) of the software, what's wrong with that? You got good utility for your money. Maybe mandrake will turn a nice profit, and the company and price will grow even more, too.

    Nothing wrong with that. Even if you're not a dirty linux hippie. Heh.

  • Now you've got a company that holds patents on every viable memory type for personal computers. You know that PC's are selling like hotcakes and that means memory is too, which all boils down to huge royalties for Rambus.

    Except that it's also obvious their patents were completely out to lunch and their behaviour bordered on (and may have been) criminal. However, I do see that RAM is more and more important, and processor speed is becoming less so - might I be more interested in companies that produce RAM, very likely! Betting the farm on one company is stupid, and so is falling in love with a stock. I'm not talking about either. If I see a product I use everyday, see lots of other people using, I like it, the company is doing well - but their price is down - then I'm going to buy. Just like I'll sell it when I think the price is too high. Example, Honda Motor Co, or 3M.

    It makes sense to limit your individual stock purchases to those areas you have some special knowledge about, but if you fall in love with a stock like PALM or RHAT or LNUX because they mirror what you think, you may be screwing yourself

    Or maybe not. Nobody's saying that's all you should invest in. My point is that if Mandrake offered stock to raise money, and you bought it because you liked mandrake, there's nothing wrong with that. If you expect to be a millionaire, well, that's going to bite you in the ass. It's about making an informed desision, and that's one of the key ideas. It's easier when you know the product and the company. I stayed the hell away from Nortel because they hired the most clueless idiots for YEARS from my university. I didn't like that, so I shyed away for companies I knew good things about.

    LNUX is a bad example. Ick. Not enough valued-added there for me to bet my money on right now. Palm and Redhat are different, IMHO, although Redhat might be getting back up into overvalued territory now. Redhat's getting close to profitability, and if linux is going anywhere, it'll probably be through them or IBM.

    Remember, there are a lot of people making money on MSFT stock.

    Hell yeah! Monopolies are great places to invest. I know lots of people making money off of a nice divendend-paying stock - Aliant, the local telco here. Whether or not the microsoft one will last is a matter of debate, personally I don't think it will long term, or more correctly: the high profits their current price is based on will not hold in the long term, so I see no incentive to buy.

  • "I might buy $1000 worth myself if they did this, just for the hell of it. Would you?"

    Well, if was apparently like all the other geeks around here and crapped bricks of $100 bills sure.

  • I was being generous with figures, and based it on a extreme lowball, trying to give an all around generic base.
  • ...maybe the better way for the LINUX community to support Mandrake is to petition those very few OpenSource-minded individuals made obscenely wealthy by the recent boom (ESR [slashdot.org], I'm talkin' about you!) to become benefactors of Mandrake.

    I mean, come on Eric, do you really need another Soviet-issue RPG-7G or M-72 light anti-tank weapon at this point? You've got enough to win most arguments you could get into.

    I'm being semi-serious here. I'm not optimistic about Mandrake's survival if they intend to pass-the-plate around the linux community and hope that they get enough in tithes to stay alive. The sports franchise examples offered by Mr. Bryar assumes that the high regard for Mandrake of the linux-loving population somehow equates to the profound devotion and civic-pride one has for a local sports team, and for attending local sporting events. Regardless of the enthusiasm of the community for Mandrake, I'm not optimistic that this would work.

    Maybe the best option is to have big Linux companies create their own sports franchises, with something geeky-fun like Internet televised BattleBots or laser-tag tournaments featuring executives/programmers at the various companies (officiated by Geeks In Space, :-p), and then have competitions between the corporations that sell a bunch of merchandise to make money....

  • Stocks are supposed to be to support a company

    I think that's kinda the point - Mandrake users want to make sure it stays around so they buy stock in the company to make sure it has the working capital to do so.

    Or you can look at it a different way - investors buy stocks because they expect a return .... it's just that traditionaly the return is money .... in this case it might be money, if they are wildly successfull, or it might be in some more intangable (and untaxable!) form like free access to cooler software in the future (ie a better distro) etc etc. In general I think a lot of the really cool stuf about open source has happened because of the growth of this largely non-money "hacker-gift-culture" sort of economy

  • Maybe that's why the economy is in the toilet: not enough fun...
  • Also, their English grammar is tragicomically bad


    "Yeah, them friggin Frogs yad think thay could rwite propah English, like um, dunno, like in Slashdot posts ?" :o)

    English has become a tool for international communication. As long as what you write can be understood by the majority of your users (and this is the case for Mandrake's texts), proper grammar/spelling is irrelevant. Blaming software developers for their poor mastering of The One True Language of Civilization and Progress [everything2.com] is like blaming Arthur C. Clarke for the historical inaccuracies in "2001".

    Thomas Miconi
  • Along this same line of thought, I was thinking that it would be better if there was some kind of financial blanket that covered the entire Open Source / Linux / Free Software (whatever) movement:

    This of this as similar to government grants. Anyone can apply for a piece of the money, but they have to provide certain justifications and report on their spending. The governing body would review applications, solicit money from donors and distribute money to the grant winners. Presumably this body would be made up of reporesentatives from all aspects of the movement: the for-profit companies that provide Linux distros, non-profit groups like FSF, unassociated developers, and user groups.

    I think that this would probably be a pretty successful way of organizing the direction of commercialized Open Source. Work could still go on independantly by avocational developers, but it would also help discourage duplication of effort and forking among larger commercial projects.

    Does such a thing exist yet? Anyone wanna be the first Vice Chair??
  • Though I am certainly no Packer fan myself (I'm from Minnesota) I have to stand up for every Packer fan I have ever met. The Packers are able to survive, even thrive, in probably the smallest market in professional sports. This is due, in no small part, to having the most loyal fans of ANY professional sports team. The waiting list is very long for Packers tickets -- a good friend just got his two season tickets 28 years after his parents put his name on the waiting list when he was born. The list is surely longer now than it was then. Home games for the Packers are completely sold out for the foreseeable future and this where half (approx.) the home games are played in weather well below freezing. I'd say the middle of the league in revenue isn't so bad at all. In addition they have some stadium proposals out that would fix the current small stadium size (and some of these plans are absolutely spectacular).

    Any professional sports team with fans even half as loyal should be proud.
  • The Green Bay Packers MAKE money, RedHat, VA, Mandrake, etc. do not.
  • A core dump is just a simplified blue screen of death You should change you sig... because you are wrong... core dump in unix is what a dr watson (or general protection fault) is in win32 a kernel panic in unix is what a blue screen of death is in win32 Please get your facts staight... I would rather have a core dump than a BSOD any day because core dump leaves the kernel in a stable state, but kills the processes... a kernel panic on the other hand... ouch those hurt big time.
  • I'm thinking that Mandrake could (for example) offer a GPL-version copy of their software and five shares of MandrakeSoft for (say) $80, via their website.

    Hmmmm.... a lot of people would sell, except for the trading cost. As long as the trading cost is a significant fraction of the stock value, they won't sell.

    If you get a cert, can you sell it without going through a broker? If you can, there goes the trading cost.

    At any rate, this would force Mandrake to purchase shares (possibly on the open market) to close the deal. If the stock ever did go up, they'd be squeezed into a really bad deal for each purchase.

    It's a much better deal to simply offer the shares directly to customers because... 1. They know the customers are interested in holding the stock, at least for a little while. 2. They can accumulate shares before they offer them. 3. They can choose not to offer shares directly and/or they can choose when to purchase their own shares (e.g., during an October panic).

    Of course, IANAFinancial analyst so I might be missing the mark somewhere.

  • NewsForge is a subsidiary of VA Linux (NASDAQ, LNUX) as is Slashdot. So, they are not competitors in the traditional sense. For some reason, LNUX wants more people to take an interest in NewsForge. Why I don't know, since Slashdot is a valuable franchise... or it would be if they offered Slash-based site setup and customization services. Hint, hint, concerned stockholders... recurring revenue streams please.

  • Could Slashdot Sell Stock To Users Who Hate It?

  • by shion ( 144207 )
    Mandrake 7.1 lacked C++ development headers, and their idiotic mirror scheme makes it impossible to get the correct rpm.

    Also, their English grammar is tragicomically bad (ie, in MandrakeUpdate).

    By the way, if anyone has the libstdc++-devel rpm from the days of 7.1...

  • At $5.45 I'm not ever going to get rich from owning Redhat stock. I'm not a programmer and don't have a lot of spare time to donate to beta testing or contributing to open development. So I own a few shares and I buy a Distro once in a while. (Not always Redhat, sometimes Mandrake.) I just think of it as chipping in for the cause.
  • Look, if Mandrake is a worthwhile project but can't make money, it should become a non-profit. People could donate without worrying about whether it was somehow appropriate to do so. Now the founders of Mandrake wouldn't make the big bux, but so what?
  • Well, I'd buy some redhat if I had spare money, because I like the product.

    The thing is that buying Red Hat (post-IPO) stock doesn't benefit Red Hat -- it benefits the seller of the stock. While there might be runoff benefits of this (one less angry shareholder who will vote out the top management?), you're not doing and big favors for Red Hat. If you really want to financially support the company, you'd be better off buying their product (their service & support in this case), or donating your money to the company directly (if such a mechanism exists)

  • I find that it would be one way that I would give back. Why? I'm not a coder--I'm a user. I'm working my way up to be a coder, but if I contributed to something like a distro right now, I'd fear that I'd screw it up. So why not give the distro some of my money as well as feel like I own a piece of that distro?
  • There's a more important question than who would the buyers be. That is, Who would the underwriter be? From a business standpoint, there must be an underwriter that handles the transaction to the extent that Mandrake gets it's money in one lump sum and can then use it to continue to build it's business. Bringing in a couple dollars here and a couple dollars there wouldn't do it.

    The underwriter would have to be reasonably confident in the company to begin with, to essentially the same if not a greater extent than the market as a whole. I suppose their could be an alternative underwriting agreement, similar to what you see in boilerroom trading outfits, although that would put a major stigma on the company, above and beyond that currently attached to the word 'linux'. It's a tough sell any way you cut it, but there are certainly enough new outlets to make IPOs available to the public at large. Well, good luck to them.

    --CTH
  • Open Source is a great social/political/I hate MS movement. But I can't write code... I'd feel dirty donating money to a for-profit company... I've already bought the boxed 7.2 (but I like 7.1 better) and am thinking about 8.0. Buying the stock would be a good way to contribute; I'd be giving them money to help them out, but it wouldn't be charity- it would be business.

    Business models that rely on OS need to admit that they are businesses, just like their competitors, and recognize that without the crutch of proprietary IP they need to be twice as creative as their "Old Economy" competitors. Consumers that rely on OS based businesses need to recognize that free beer, as much as we like it, does not keep a business afloat.

    Packers-style investing can help out a lot in the near term, although it isn't a long term panacea. Mandrake needs to be at least break-even within a few years of an IPO to prevent their stock from becoming "I Donated To Open Source" bumper stickers. It only helped Green Bay keep their team local, the management still needed to keep the franchise financially viable.

  • OK, I see your point. You are willing to pay to have input in the direction of the company and the software. That's fine, but not necessarily a good thing without monetary risk and reward. Some clueless wannabe Linux user with tons of money to burn might pour tons of money into buying shares of this 'stock' to have a bigger say in how the company is run. But without monetary rewards and risks, there's nothing stopping him vote to make it run like M$ Windows. And when he's voted on too many stupid things, and the software is no longer what anyone wants to use, and there's no monetary loss for him, 'cause he now has what he wants, but not what the majority of people want, your investment into 100 'shares' is now a waste because the software is now nothing like what you, or the majority of people, want out of it. I guess that's where I see the flaw in doing this, even though that's probably a pretty far-flung possibility.

    On the other hand, I think sending a donation to Mandrake for their hard work, without any rights to say how they run their show is quite all right. It shows them that you, personally, are ecstatic about the work they do. I'm sure they'll consider your input very carefully when designing their next code release, because they want to keep you pleased for your generosity towards their cause. Also, with this system, they still don't have to listen to the guy sending them millions, because he has no 'voting' rights, he just likes giving lots of money to them just like you and the other non-millionaires.

  • I'd really rather not see them go public. Investors could care less about user friendliness, compatibility, and standards compliance; they're in it only for the profits. Mandrake will have to answer to its shareholders first, and its customers second. Don't we already have enough corporations doing that now? And badly, too, I might add.
  • Interesting synchronicity there. I'm not a coffee drinker myself, but my parents said Tully's was much better than the Starbucks behemoth. So if Tully's = Mandrake and Starbucks = Microsoft this might just work.

    "What are we going to do tonight, Bill?"
  • by MAXOMENOS ( 9802 ) <maxomai.gmail@com> on Thursday May 31, 2001 @09:43AM (#186111) Homepage
    Absolutely you should be doing all of those things. However, buying a piece of the company wouldn't hurt either, especially considering that this would give us users more of a voice in the way that the company is run. Not to mention more of a motivation to get off our tushes and contribute something. :)

    ObJectBridge [sourceforge.net] (GPL'd Java ODMG) needs volunteers.
  • by xtal ( 49134 ) on Thursday May 31, 2001 @10:03AM (#186112)

    This assumes you're a programmer will skill in the area. If, for example, I'm an embedded systems guy (which I am), I might not have time to learn what mandrake needs. However, if I'm very successful, I'll command a high salary and make lots of money. I can help buy providing resources to hire someone who does have the expertise to aid in the development of the project, with the results of the $ going back out into the open source community. This seems to work really well - why would it go against the model? Obviously, this assumes you use the product and provide feedback, or you wouldn't know about it or that it needed work.

    To use another classic example: If you're a lawyer and make $150/hr, and you need your house painted. The job will cost $500 and take 16 hours. You'd be stupid to save the $500 by working those 16 hours; you could do what you do best, and pay the specialist to do the work. Same applies to car repairs, etc. If painting is your hobby - like coding is for myself and others - that might be different, but for most people, that's not the case.

  • by joq ( 63625 ) on Thursday May 31, 2001 @09:38AM (#186113) Homepage Journal

    Personally I think this would only help in a short term manner, and here's why. So you plan on selling say 100,000 shares of Mandrake stock at let's be fair with the price, in accordance to whats going on around NASDAQ, 6.00 (US) which would give Mandrake an extra 600,000.00 US which is enough to hold them for a short while.

    A team of 20 developers at 35,000.00 a year would leave the company 100,000.00 a year under, not including office space, equipment, etc. So unless they plan on selling a massive amount of stock with people willing to continously buy from them, how could they expect to recoup any money to pay back investors who purchased it from them?

    So there stock goes up let's say to twice that amount, because more people think it's a good idea. Ok eventually they'd still have to turn a hell of a lot of profit to keep the investors happy else they'd fall miserably, as many companies have within the past few years.

    I wish them the best, but I doubt it would work. If you take a look at some of the strong companies in their field, let's say Baltimore Technologies, which is one of my favorites. They specialize in security based products, and have a strong market segment, yet their stock is doing poorly (under 3.00) so what makes you think a company like Mandrake could cut it in the market, when proven companies are having a hard time...

    © Pimpfolio [antioffline.com] ghetto stocks all the time
  • by selectspec ( 74651 ) on Thursday May 31, 2001 @10:14AM (#186114)
    There are literally dozens of various instruments that Mandrake could employ to sell equity. The reasons they don't are as follows in ranking order:

    1. Honest Greed. The current owners believe their equity is worth more than the probable market perception. If this is correct, the sale of equity could result in a higher than tolerable cost-of-capital. In such a case, the company may have better alternatives to raising capital, such as through various debt instruments which may provide a lower cost-of-capital or even aquistion.

    2. Tax. Publically traded companies must register as C-Corps. Mandrake may not already be a C-Corp, and probably is an S-Corp. S-Corps allow for pass-through-accounting, so the corporation doesn't pay any taxes (the owners pay the taxes or in this case write off the loses). I could be the FUD master here (I'm not an accountant), but this is a possible reason.

    3. Legal Mumbojumbo. Publicly traded companies must follow strict rules and regulations regardling disclosure and accounting. These restriction can severely impare smaller organizations which are still attempting to establish themselves.
  • by MrBlack ( 104657 ) on Thursday May 31, 2001 @10:31AM (#186115)
    It worked for Warren Buffett. One of his ideas was to buy stocks in companies with products he liked and used, and companies with products he understood. The difference between what Warren B. advocated and what XTAL seemed to be suggesting (although I'm not taking his casual comments here as XTAL's opus on investing) was investing in companies with a monopoly. The acid test was "If I have a huge supply of capital" (which Warren Buffett no doubt does) " and if I had access to all the top talent in this industry, what companies would I still be unable to compete with." With a strategy like this (and the fact that Warren is friends with Bill Gates) it is amazing he's never invested in Micro$oft. He said he never did because he didn't understand the software industry.
  • by rhadamanthus ( 200665 ) on Thursday May 31, 2001 @09:31AM (#186116)
    Well, not surprisingly anyhow, the Green Bay Packers probably have the best attendence and loyalty of any team in the NFL, simply because they are "part of the community" (and also, i'd bet, because they are "owned" by the community). I'd buy stock just to show my support. Naturally however, as a bonus to Mandrake, I would be hard-pressed to buy from any other linux distributor.

    Sounds like a cool idea...

    --rhad

  • by cavemanf16 ( 303184 ) on Thursday May 31, 2001 @09:33AM (#186117) Homepage Journal
    Usually when I invest in something, I expect to make money doing so. This is just another way to promote donations. I donate to charity, not corporations.
  • by xtal ( 49134 ) on Thursday May 31, 2001 @09:44AM (#186118)

    The stock market per se is just a way to target a more general (and much bigger) audience of investors, some (most) of which who have absolutely no idea what you do, how your product works or is engineered, etc. If you read the all time classic (in what, it's 18th printing?) How to Buy Stocks, back in the day, you knew the people who invested and ran the company.Stocks were a way to measure the amount of the investment to judge who gets what share of the profits/rewards. This has been missed by the markets, somewhere.

    Would it work? Well, I'd buy some redhat if I had spare money, because I like the product. I bought a lot of Palm when the stock went down, because I like that product, too, and work with it. Same thing for AMD. Mandrake is just the same thing continued, although I'm not a mandrake user.

    People are kinda supposed to understand what they're investing in, which is why I find the market insanity amusing. I buy products I use and like, and I haven't been clobbered for it e.g., 3M car wax.. 3M stickies.. 3M abrasives.. hrmm... 3M.

    My advise to investors is, ask yourself: "Do I use this product? Do I like it? Do I understand it? Would I pay money for it? Would anyone else? Does that matter?", and you'll find the answer quite clear. This looks like a good idea to me, though - support a product you use and like to development continue, and you might see a return on it someday.

  • by wrinkledshirt ( 228541 ) on Thursday May 31, 2001 @09:29AM (#186119) Homepage
    That way, they can concentrate on making great software instead of what will make the shareholders happy. Mandrake's developed a reputation as a good newbie distro as well as a cutting-edge distro for the not-so-newbie. More importantly, they've garnered their own mindshare within the industry. I think developing a body of shareholders might influence them to go one way or the other. As well, this sort of move might open up the way for other business-centred moves, like (eg) letting themselves get bought out by another company.

    I think, if they have a good solid foothold in the industry that can't be usurped by another company, the way Red Hat does, they might want to try going public. Until then, doing so might make them even more vulnerable to the manipulations of the business-minded.

  • by MAXOMENOS ( 9802 ) <maxomai.gmail@com> on Thursday May 31, 2001 @09:51AM (#186120) Homepage
    As the article stated, the SEC would most definitely allow this under Regulation A. Quoth the article:

    That doesn't necessarily mean that a Linux company can't have a successful stock offering. In fact, smaller U.S. Linux companies don't need lots of lawyers, or even a terribly convincing bottom line to offer stock. They simply need a community that rabidly supports them, pure financial considerations aside. The best fund-raising vehicle for such companies looking to raise $3 million to $5 million is called a Regulation A offering.

    In the caffeine-crazed Pacific Northwest, one of the most successful Reg A filings in recent memory was for Tully's Coffee, a cult-like business that sold common stock back in 1997 at $2.25 a share. Unlike a traditional IPO, Regulation A allows companies to promote their stock offering to their enthusiasts, through radio, direct mail, or other devices. Tully's employees wore buttons that said, "Ask me about our stock," and the company promoted the offering on its coffee cups. Reg A offering tend to work best for companies with an affinity group -- a set of customers who are so loyal they'll buy stock as well as product, essentially underwriting their financial investment by their continued patronage. Regulation A is tailor made for the Linux community. For those companies whose evangelists vastly outnumber their paying customers, this might be a reasonable way to raise needed cash.

    I'm thinking that Mandrake could (for example) offer a GPL-version copy of their software and five shares of MandrakeSoft for (say) $80, via their website.

    ObJectBridge [sourceforge.net] (GPL'd Java ODMG) needs volunteers.

  • by jasno ( 124830 ) on Thursday May 31, 2001 @09:25AM (#186121) Journal
    Doesn't that kinda go against the grain of the open source model? If I want to contribute and help out mandrake, shouldn't I be writing code, giving feedback, using the product, writing documentation, etc? Think about the amount of money a professional programmer makes and the amount of money you'd have to give in order to get something done. Why not just contribute? Sure, you may not help them survive as a business, but why is that the goal?
  • by sjbe ( 173966 ) on Thursday May 31, 2001 @10:26AM (#186122)
    There are some good reasons to go public, but sustainable businesses usually wait as long as possible before doing so. There is an obsession with taking a company public early on these days. A few companies have been successful with that strategy but most of the biggest ones were successful concerns long before they sold stock on the public markets.

    Selling shares of the company can be a great way to raise cash, but it also introduces a whole different set of constraints on management style. Public companies have to be much more concerned about short term finanical numbers instead of the big picture. The management has to please investors which often forces them into actions that aren't always the most prudent in order to keep the balance sheet in order. This can be a huge distraction for a young company.

    Now I'm not saying Mandrake going public is necessarily a bad thing, but I do wonder if it is being done for the good of the company or if it is being done simply to make money for some venture capitalists.

  • by lightware ( 415793 ) on Thursday May 31, 2001 @09:39AM (#186123)
    Well that would be pretty damn cool, and I would participate, but only under one condition:

    Shares could be used as currency to motivate the company to support special features.

    How 'bout a special site where stockholders can converge and agree upon features they'd like to see in the distro? They could then pool together in the agreed upon feature set category and wager support by allocating x shares to features they want to see.

    14 shares added for journaling file system support
    5 shares added for extended wireless networking features
    etc

    While you may only wager so many shares on a specific feature you'd like to see, if there were enough people that wanted to see that feature supported as well, it could add up.

    Not only that, but one could get a visual idea of the support of the distro, and a representation of paying sponsors.

This place just isn't big enough for all of us. We've got to find a way off this planet.

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