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Reddit cites r/WallStreetBets as a risk factor in its IPO filing (techcrunch.com)
submitted 2 years ago by [M, B] to c/technology@lemmy.world
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Reddit cites r/WallStreetBets as a risk factor in its IPO filing::As Reddit finally files to go public, the company wrote in its S-1 filing that "meme stock" schemes on r/WallStreetBets could pose a risk to investors.

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[–] 8 points 2 years ago (2 children)

I'm confused how they could be paid in stock options when they aren't traded. Do they just use made up numbers until this point and get "paid" in exposurebucks?

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  • [–] 13 points 2 years ago

    Even if a stock isn't publicly traded it still has value. It's just that retail investors can't buy or sell it. Basically, it's owning a part of the company. So they now technically own whatever percentage (number of shares/total number shares available). Unfortunately, it doesn't equate to a monetary value to the company itself just show's the company who owns what percentage of it.

    So well the company is "valued" at what it is now, they are only saying that if they were to sell all those shares in the open market that would be what it's worth. Now in the business world the CEO & CFO will be able to go get loans based on that value (putting that stock as colaterial) but it's basically all that they'd be able to get right now.

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