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31/12/22
07:19
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Originally posted by BobF
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Your reasoning is not unreasonable at first sight, but:
1 One could say that FB has needed to fund the company through loans. But instead he has funded it both through loans and by putting up a very large chunk of his own cash, and has thereby put it at direct risk. One could also say that he has never wanted it to be a public company because he has always had the confidence that the product will be successful. If he was savvy and doubted the investment he would have hedged his bets better, and would surely have tried to put more of other peoples money at risk first as far as possible. The two are not really entirely consistent in my mind anyway. He has had both the need and the opportunity to fund it through loans, and has probably done so because he envisaged being able to convert those loans to shares when he had the right opportunity. I dare say the other largest investors hold similar views and probably have a similar level of insight into the risks and opportunities the venture poses.
2 Yes that was the placement price, so it was the price that had to be paid. But one would only buy in IF one believed the investment was a good one that would lead to a significant profit at some future point. If one doubted this why would you be persuaded to invest at all, let alone throw a second million bucks at it?
3 EM is an unknown to most of us for sure. I also had some disquiet when I heard about EM. This is where my conviction that FB and other directors and voices at the table have done their DD and reached the conclusion EM are a good choice as a manufacturing partner. And this they have already spoken about in exactly that way. They have, I agree, put a lot at risk by that decision, but my assessment of the situation is that they remain convinced that it is the best way to get a qualified product they can take to market soonest and without too many problems. And they have had working chips coming out of EM for some considerable time. Covid of course has thrown a spanner into the gears, and we just have to live with that, but I suspect the same could have been said about any other FAB, and given the chip squeeze globally I suspect they have made a good call, if not the best possible call.
You are welcome to your opinion of course. And I note you say you are not a holder. I have a differing opinion and I remain invested, and have just added to my position - even today. DYOR.
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‘…I remain invested, and have just added to my position - even today. DYOR.’
That’s indeed brave BobF; I was very tempted at the $10 point, but was disappointed in yesterday’s ‘non-updates’.