:: lim(y=1/x) ::

Remember how I triumphed on the acquisition of iBetcha.com? Well, I enjoyed the moment then, and now I'm back for the lesson.

Remember the press release?

"Uproar will acquire all outstanding shares of the parent company of ibetcha.com Inc. in a stock-for-stock transaction in which the selling stockholders will receive approximately 1.33 million shares of Uproar common stock."

At time, this was worth a little over 8 million dollars. Not a big hit for a company that raised its last round at around the same amount, but a little party for the founders, each was reported to gain around half a million, and also a nice achievement, as what was invested was around a quarter of the amount. Today this is worth something like 4.5 million. Same thing, on a different scale happened to the stocks of Lucent, and VerticalNet.

Why is that?

Because, the driver for a stock-for-stock transaction is an overvalued stock price of the buyer. And when this goes down, the deal evaporates.

Now look at Uproar stock graph and answer the question:

What is lim(y=1/x)?

Next time you sell a Start-Up, do your math.

Wadi Writer #1 (Gray )

WadiList@mail.com

Links:
http://www.clearstation.com/cgi-bin/details?Symbol=upro
http://www.ibetcha.com
http://www.uproar.com

From the Wadi Archive:
:: iBetcha.com :: http://oocities.com/wadilist/0005.htm
:: Told you :: http://oocities.com/wadilist/0079.htm