The race is on for flashy IPOs

Chris Graythen / Getty Staff

 

Hello,

Welcome to the pre-Labor Day edition of Trending, the weekly newsletter highlighting the best of BI Prime’s tech coverage. This is Alexei Oreskovic, Business Insider’s Global Tech Editor and West Coast Bureau Chief.

As always, I’m eager for your feedback, thoughts, and tips — you can email me at aoreskovic@businessinsider.com. And remember to sign up here to receive the newsletter in your inbox every week.

This week: The race is on for flashy tech IPOs

Hot on the heels of WeWork’s S-1 filing, Peloton, the maker of that pricey exercise bike your boss loves, has taken the wraps off its IPO paperwork.

There’s a lot of similarities between these two companies, and I’m not just taking about all the red ink on their income statements. 

Both of these New York companies have garnered rich valuations in the private markets despite spiraling losses, they both have dual stock structures giving insiders 20 votes per share (one-upping the already controversial 10-votes-per-share norm of  their Silicon Valley counterparts) and both stretch the definition of what it means to be a "tech" company. 

 If you’re not yet a subscriber to Trending, BI Prime’s tech newsletter, you can sign up here.

Peloton’s internet-connected exercise bikes let users tap into live spin classes that are all the rage among techies. But lest you think of it as a mere fitness-equipment company, Peloton’s S-1 explains that it is both a "global technology platform" and a media company. 

Get ready for a reprise of the loud debates we’ve heard about WeWork, which has a business that’s arguably more akin to an old-fashioned real-estate company than a tech company.

As Troy Wolverton lays out in a series of reports and analyses on WeWork, much of the wariness about WeWork can be distilled into two very large, yet imbalanced, financial metrics at the heart of its business. And with WeWork trapped by its hefty $47 billion private market valuation, and staring down a wall of skepticism, at least one prominent critic thinks there’s a chance the IPO might not happen at all. 

Read the full story: 

2 big numbers — $4 billion and $47 billion — sum up WeWork’s business model and the risky reason it could collapse in a recession

China Daily/Reuters

And from the "Only in Silicon Valley" file:

You’ve got to read Julie Bort’s report about the latest legal dispute involving Oracle and Larry Ellison to believe it.

The lawsuit involves Oracle’s $9 billion acquisition of NetSuite, a company that Ellison founded and owned a 40% stake in. OK, that’s not a great look.

But here’s where it gets really weird: A special committee of Oracle board members, tasked with investigating the matter, decided to allow the shareholder who filed the lawsuit to act on Oracle’s behalf in the lawsuit. In other words, Oracle, the corporation, is suing Ellison, the chairman and founder of Oracle. If the case goes to trial (which is still a big if), it’s going to be a fun one to watch. 

Read the full story:

Oracle is suing Larry Ellison and Safra Catz over the $9 billion NetSuite deal, thanks to a letter written by 3 Oracle board members

AP

Other recent tech highlights:

• Facebook is reviewing hundreds of its official ‘Facebook Marketing Partners’ over Instagram data-scraping issues

• These 3 engineers are using their experience at Apple, Qualcomm, AMD, and Tesla to help Intel move beyond PCs and beat its rivals to a $300 billion opportunity

• Everything you need to know about PyTorch, the world’s fastest-growing AI project that started at Facebook and powers research at Tesla, Uber, and Genentech
• This founder raised $1 million before Y Combinator’s Demo Day to make a better database communications tool for distributed teams. Now he needs a team.

• Google pushed an exception through to allow US Customs and Border Protection to try a key cloud product free, even as 1,300 Google employees protest any work with the agency

• Facebook’s key partners on its cryptocurrency Libra are refusing to publicly support it

And more from across the BI newsroom:

• Herding cows and hiring private investigators: Wealth advisers told us their stories about next-level requests from uber-rich clients
• Netflix’s former head of kids programming explains how family shows stop subscribers from canceling, and who the major streaming buyers are today
• Beleaguered media measurement giant Comscore is turning over a new leaf, again — and says it will be cashflow positive by the end of the year
• ‘It reminds me a lot of the peak in 2000’: Legendary investor Rob Arnott compares today’s market to the tech bubble — and explains why value stocks are the ‘place to be’

Thanks for reading, and if you’re in the US, enjoy the long holiday weekend,

Alexei

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See Also:

• Peloton warns that its inability to license premium music for its at-home workout classes could be one of the major downfalls to its business model
• WeWork has reportedly been bleeding HR managers in the last year, and some are pointing fingers at CEO Adam Neumann
• WeWork gave out 58 stock awards worth at least $1 million each in February, and 94% of them went to men, according to a lawsuit

Source: Business Insider – aoreskovic@businessinsider.com (Alexei Oreskovic)