Changing The IPO System?

from the is-it-worth-it? dept

The final segment in Red Herring’s seven part series on the evil goings on behind IPOs is about possible ways to change the system. They talk with Bill Hambrecht who’s a huge supporter (through his WR Hambrecht company) of the “OpenIPO” system, which is something like an auction that allows equal access to IPO allocation. It’s definitely a good idea, and one that I’ve liked – however, companies are less willing to go for it, as they want a big name investment bank to go out and build the demand for their IPO. Some other proposals for changing the system are presented, but mostly you get the feeling that the system is just going to keep doing what it’s always done, and if people are particularly bad and greedy (and get caught) they’ll get taken down. Otherwise, many of these questionably ethical practices will continue on, as some rich bankers continue to get richer.

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