Some Fallen Dot Coms Have Plenty Of Cash
from the more-than-they're-worth,-in-fact dept
We’ve mentioned this a few times before, but it seems that more fallen “technology stars” our there are now valued at less than the cash they have on hand. That is, (in theory) an investor could buy up the company, pay off any liabilities, liquidate the company, and have more money than when he or she started. In practice, nothing is that simple. Any attempt at buying it up would likely drive the prices up, and there are plenty of costs associated with shutting down a company that would probably eat up any profit. Also, at the rate most of these companies are burning cash (and, yes, are they ever burning cash), it won’t be long until both their cash-on-hand and valuation continue to drop.