Fox Business News Quotes Manatt Partner on Entrepreneurs' Shift in IPO Thinking

"Should Silicon Valley Be Toasting Twitter IPO?"
Fox Business News

November 7, 2013 - Fox Business News quoted Manatt's Matthew O'Loughlin, a partner in the firm's Corporate & Finance Practice, on how entrepreneurs view  IPOs differently today than they did during the times of the dotcom bubble that formed in the 1990s. 

Fox Business News reports that since Twitter made its public debut on the New York Stock Exchange,  there is a concern that there are bubble-like tendencies popping up with digital companies that aren't yet profitable. However, industry experts told the publication that while some companies are a bit overvalued, they are not seeing "bubble-like excess" in the community and are less concerned, because today's startup entrepreneurs have a different perspective on business fundamentals than founders in the dotcom period.

O'Loughlin, who advises public and private companies, investors and private equity groups, told Fox that some of the allure of going public has faded since the dotcom bubble burst.

"The construct of increased stature, reputation and standing - that you finally made it - some of that went away a little bit," said O'Loughlin. He added that entrepreneurs no longer look at IPOs as the be-all and end-all of success.

O'Loughlin said it's not just the dotcom bubble that has caused the shift in thinking. Looking at Enron's implosion and the resulting tighter regulatory environment, he said entrepreneurs now recognize that going public isn't just a matter of whether or not investors are expressing interest.

"You're now a more developed company before you go into an IPO … It doesn't always make economic sense to have to deal with the compliance costs and also some of the restrictions when you go public," said O'Loughlin.

Read the article here.