Give PIPEs A Chance?

from the why-bother? dept

A Red Herring article about why not all PIPEs are bad. A PIPE, of course, is a private investment in public equities – basically, a company that is already public raising more money from VCs instead of through an additional public offering. What’s amusing is that the Red Herring was the magazine that trashed PIPEs last year (though, they admit that in the article). They still say that many PIPEs are bad; they massively dilute the existing shareholder stakes, and often offer very mixed incentives for many of the folks involved, but there are situations where they can be helpful. In general, though, if you’re a public company and you’re looking at a PIPE, you’re in some pretty serious trouble.

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