Rivian IPO

BonsaiNut said:
Rivian priced their IPO last night.

https://www.marketwatch.com/story/r...e-raising-a-whopping-11-9-billion-11636514435

This valuation places the entire company at $77 billion on a fully diluted basis. Compare to GM with a market cap of $86 billion.

Go Irvine!
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I’m wishing them well, and if they get the money, more power to them. But they’re only going to produce 1000 trucks this year, and have said they won’t work off their 50,000 unit order backlog until 2023.

so that’s valuing the company at almost 20x for every $1 of next year’s sales.
 
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AKAKTM said:
It seems classical valuation models based on sound economic analysis is no longer adhered to by today's investors when investing in 'tech' companies.
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Hey, I didn't say I thought they were a good deal :) I simply said I am watching from the sidelines as one of the biggest IPO's of the year takes off. I am a very conservative investor who believes in sound economic fundamentals. But at some level I think people are doing with electric cars what I did with 3D graphics manufacturers. You know the industry is taking off, but you don't know who is going to come out on top. So you invest in the top three in the hopes that you lose all your investment in one, break even on the second, and make 20x on the third!

I do admit to liking some aspects of their pickups. For example, unlike the Tesla pickup, they actually look like a pickup. But the lightbar and headlights on the front really turn me off.

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BonsaiNut said:
Hey, I didn't say I thought they were a good deal :) I simply said I am watching from the sidelines as one of the biggest IPO's of the year takes off. I am a very conservative investor who believes in sound economic fundamentals. But at some level I think people are doing with electric cars what I did with 3D graphics manufacturers. You know the industry is taking off, but you don't know who is going to come out on top. So you invest in the top three in the hopes that you lose all your investment in one, break even on the second, and make 20x on the third!

I do admit to liking some aspects of their pickups. For example, unlike the Tesla pickup, they actually look like a pickup. But the lightbar and headlights on the front really turn me off.

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You will never unsee this next image:

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Agree on the headlights and front end in general. It’s a non-starter for me. I’m waiting on the new Tundra but will probably be waiting until 2023 because I’m not paying over MSRP and I’m sure the 1st ones will be $10K over minimum.
 
sir crashalot said:
Whats an IPO?
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Common phrase "going public". It means you are taking a private company, and selling ownership shares (or issuing bonds) on a public exchange. Though it does not necessarily mean that the majority of the company is owned by the public (ie you can offer shares in a minority of the company) there are many restrictions that come with going public - not the least of which include publicly reporting your financial information every quarter and having a board of directors whose job is to represent the interest of the shareholders. The primary advantage is that it allows companies to tap public markets for financing. You don't have to go public, and some companies never do. As long as people believe in your company, you can borrow money from banks or sell private shares without having to disclose anything to the public.

FWIW, after going public, you can take a company private again by buying up all the outstanding public shares. This is usually done at a premium to the market value, and requires an approval by the shareholders. Though it sounds complicated, it is actually as simple as saying "hey our stock currently trades on the market for $10 per share. Would you sell your shares back to the company for $12 per share?" If a majority of shareholders vote "yes" it's a done deal.

There is often a lot of hype attendant with going public, especially if you are a company like Google or Rivian that people see a lot of future potential in. Tesla went public back in 2010, and the first day of trading you could buy shares at $3.80. Each share today is worth $1023. Google was a little hotter - on the day of their IPO shares were trading at $100. Today each share is worth $2941. Of course, there are plenty of companies that go public and then proceed to become worthless, in which case you lose all your $$$.

 
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I have no interest in an electric vehicle for the foreseeable future, so the Rivian doesn't mean anything to me.

Anecdotally, tons of people seem to like it. But I would say that every single one of them likes the F150 Lightning too, and Ford seems to be doing well with their electrics.

On the other hand, Bozo's has his hands deep in the company and wants a million vans, and that is worth a lot of long term value. Only a matter of time before UPS, Fedex, etc go electric, and I am amazed that the Post Office hasn't been mandated to go electric yet. That is a lot of money for whoever is building electric vans.
 
I am also a conservative investor, but have realized that EVs are here to stay and there will be some explosive investment opportunities. The key is to pick the right one(s) as @BonsaiNut says. I invested a modest amount in Tesla a few years back and have been slowly adding to it. Likewise, I invested a modest amount in Rivian yesterday and feel confident that Rivian will follow Tesla as the leader in EV trucks, perhaps followed by Ford and Tesla. If that's correct, the company should do extremely well from an investment perspective.

Having seen a few Rivian trucks in person, I'm excited about them. I don't love the headlights, but the rest of the truck is fantastic and very well thought out. And, as with other EVs, many of the performance aspects are unmatched and quite impressive. Ultimately, when it comes to raw performance, EVs will be dominant, while offering a more seamless driving experience. That said, I'm still holding onto my Gen 3 Raptor for a long time.
 
I’m 45 and have historically been fiscally conservative and risk adverse so I’ve only ever made moves on 3 companies: Tesla, PacifiCare (now United) and Berkshire. I’ve chosen to invest in RE mostly via joint/partnership purchases.

I’m n0t confident enough to drop money on Rivian and now that I live in TN and seeing how much it’s growing, I’m buying up waterfront land…a ton of it.

Our company currently has a 280-300 million valuation and we are preparing to go public next year. As an officer of the company, I’ll be in a comfortable position that MAY open up my pockets to ‘playing the market’ as they say.

Best in health and success to you all.
 
@Maderas84 tell me more about your company.

And, how are where are the RE investments you are making. I would be very interested in moving into more RE.

TA

Maderas84 said:
I’m 45 and have historically been fiscally conservative and risk adverse so I’ve only ever made moves on 3 companies: Tesla, PacifiCare (now United) and Berkshire. I’ve chosen to invest in RE mostly via joint/partnership purchases.

I’m n0t confident enough to drop money on Rivian and now that I live in TN and seeing how much it’s growing, I’m buying up waterfront land…a ton of it.

Our company currently has a 280-300 million valuation and we are preparing to go public next year. As an officer of the company, I’ll be in a comfortable position that MAY open up my pockets to ‘playing the market’ as they say.

Best in health and success to you all.
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