I hope these reports are true! If so, is it feasible to add to Freetrade as soon as shares become available later in the year?
Saw this summary a few weeks ago
It’s great to see another tech company’s planning going public especially one that’s losing relatively little money. They’re a little bit more low key than some of the other companies that’ve announced IPOs this year but they’re still experimenting with some interesting technology like real image recognition x retail -
What do you think of their potential for growth / business model?
We won’t necessarily be able to add every company right after they IPO but if it’s a popular stock then we’ll aim to add it as soon as possible
I don’t get the popularity of Pinterest. Tried it when it first started but meh
Agreed. $12 billion! Really?
I was more optimistic about their business model a few years ago. Since they are still losing money after ~ 10 years ( $63 million in 2018), I’m not sure I’d invest now, certainly not at a $12b valuation. It’s weird because there are so many possibilities for monetising the site, which they have failed to really get a handle on after all this time (shopping, brand showcases/engagement, image search etc). They are still growing users though (at 250m MAU), so that’s something. I expect them to slowly leak traffic now as they have been around for a long time in internet years, and have no moat against younger, more agile, more trendy, services coming along, and big services like instagram could easily become direct competitors in this space.
There’s not much in the current crop of IPOs which I find interesting personally - there are massive regulatory challenges for most of them, some engage in questionable practices, and many are still making massive losses and are vulnerable if discretionary spending by consumers and/or advertising from other businesses dries up in a downturn (which I believe is coming when the market stops levitating).
I wish I had the chance to invest in Stripe, SpaceX or Deliveroo in an early IPO, but it seems many of the really successful companies have no need of one and stay private for a long time. Sometimes it feels like an IPO is a chance for early investors to cash out of a popular but loss making service at the expense of retail investors. I’d be wary of a lot of these very high valued yet loss making companies for this reason - investing is a bet they can convert free users into cash, which is a very challenging proposition.
Totally agree, not sure how you can be losing money yet still be valued at $12 billion, surely that means all your value has been pumped in?
I expect newer up and coming companies to be losing money at first (think Monzo and our own Freetrade) as they establish themselves - but at $12 billion you should be past that stage? Especially after 10 years.
An interesting take on Pinterest’s valuation -
I think it’s a smart move for them to have a down round when listing, they need the protection of the institutions for a successful first week/month, ideally getting the momentum so they don’t plummet as soon as the support ends. Having a down round would help persuade a large firm to take on the risk.
I personally stay away from day one IPOs, it’s extremely unpredictable for my liking. Yeah that’s when you can make big gains but also wipe out a lot of your portfolio in a $SNAP
I wish them all the best but I’ll definitely be an observer and not take part.
Up 15% after hours
I thought Instagram basically owned the “visual interest” social media category, but Pinterest is clearly still growing. I don’t quite understand its appeal so never invested.
Amy thoughts on Pinterest in the long run?
Pinterest now has 322 million monthly active users, 2 billion monthly searches, and over 175 billion pins saved. And its growth is extending internationally.
91% of users say Pinterest is filled with positivity, and 89% say they leave feeling empowered.
In the third quarter of 2019, average revenue per user (ARPU) in the U.S. was $2.93. Outside the U.S.? ARPU was just $0.13 - massive growth potential to monetise.
I am going to invest a ton of money in then when my bonus comes in later this month.
Anyone bullish on this and have some insight to share?
Close to making a profit and is under the IPO price of $19
Or is it just another overvalued tech giant ?
Pros - there is some growth:
- User base grew to 367 million monthly active users in Q1, up 26% from last year.
- Q1 revenue came in at $272 million, up ~35% quarter on quarter.
Cons - the growth is slowing and they couldn’t capitalise on the Covid-19 lockdowns and resulting e-commerce jump:
- The user growth has been slowing.
- Pinterest’s revenue for April was down 8% compared to April 2019, showing they didn’t capitalise on the lockdown.
Pinterest’s revenue comes from digital advertising, which needs two things:
- A lot of users, and the above chart shows a lot (although far from the behemoth known as Facebook of course), but growth seems low (depending on how you look at it).
- Advertising spend. According to friends at digital advertising agencies, was quite a bit down in April but came somewhat (but far from entirely) back up in May.
I’ve been looking at e-commerce companies like Boohoo and Etsy that benefited a lot from what our American friends call the health crisis. Too bad Pinterest never properly got into social commerce as they said they would.
Unfortunately, advertising-driven businesses got the short end of the stick, but that might make Pinterest attractive at the right price point. It’s still a smaller user base that can grow and it has leadership in its niche, but it might as well suffer for years due to the epidemic induced advertising spend issues.
TLDR: Maybe, but not for me right now.
Up 40% today, was at $10 at the bottom of the lockdowns
For a while I was regretting picking these up after the IPO, I was down for ages but today I’m 129% up on it
Well done. It shows that patience gets rewarded. This share is another of my regrets. I should have bought it when the price was low.