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“Do You Want To Invest In PayPal?”

By Bernd Schneider

Normally, my interests in life are of another kind. I am not originally in stock trading and analyzing whether an existing public company is worth an investor’s attention.

Greg Sandoval, on September 28, 2001: “PayPal filed to raise $80.5 million in an initial public offering Friday.

Before they became a public company, Greg Sandoval, a staff writer for CNET News.com reported (on September 28, 2001) that PayPal weren’t even making money: “PayPal recorded revenue just under $20 million for the fiscal quarter ended June 30. During the same quarter last year, PayPal saw $2.1 million in revenue. The company lost $27.6 million during the quarter ended in June.

We all know that companies that don’t earn money either have to find new investors that pick up the bill, or, at some time, are likely to go bankrupt. I have quoted a US finance lawyer on the main page of this domain with the following statement: “if they filed for bankruptcy tomorrow, no one knows what would happen to their accounts.

From the perspective of a PayPal account holder who was blocked from access to his money, I was against them going bankrupt. And those who intend class-action suits against PayPal, or want to file for punitive damages, are, of course, also against PayPal going bankrupt.

I was able to recover my own funds before they went public. But from the perspective of others who have money in the PayPal system, it was fortunate that during their IPO, PayPal was able to generate much-needed capital.

There are some new terms that have been coined for the Internet economy, among them “etailer”, “new economy”, and “burn rate”.

“Burn rate” refers to the speed by which Internet businesses that operate in the reds are capable of getting through the money of investors who never look at the bottom line but just at how other, even more stupid investors, drive up stock prices by making available even more money to burn. This is called a round.

We don’t want PayPal to go bankrupt as long as they hold our money. So, please another round, preferably of Japanese banks. Judging by the state of Japanese banks in Japan, they are quite comfortable with companies that burn money instead of making it.

Posted: April 20, 2012 at 12:39 pm


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One thought on ““Do You Want To Invest In PayPal?”
  1. Desi on

    What is going to happen to Paypal at some point? I wouldnt want to invest in them EVEN IF it meant getting my money back. I think wrong is wrong and the way the conduct business just leaves me with a bad taste in my mouth. They ripped me off for a few bucks and that was enough to make me HOPE they do go bankrupt. Although with the bailouts the goverment gives these large undeserving corps, I’m sure it wouldnt matter. Their top execs would still walk away with millions