Ravenswood's OpenIPO Offering: The Sound of One Hand Clapping?

Is OpenIPO in Dutch with its Ravenswood Winery (RVWD Quote) offering that began trading last Friday? Or was it the Dutch treat that Bill Hambrecht and his son Bob were expecting?

Ravenswood, known as the cult favorite of zinfandel aficionados (its motto: No Wimpy Wines!) opened at 10 1/2 on April 9, briefly rallied to 11 1/18 and has closed near its offering price every day since. To media pundits blinded by those soaring .com IPO's, this may have been a forgettable offering, but OpenIPO President Bob Hambrecht says it's actually a confirmation that the bond-like Dutch auction system works. How's that?

"This was the first IPO ever priced by investors instead of investment bankers," Hambrecht says. "We had more than 3,000 people bidding." Of those, only about 1,000 actually entered winning bids. Hambrecht emphasized that 70% of the winning bids were individuals, with the rest coming from institutions.

"It was a noble effort," says Dick Kramlich, general partner of New Enterprise Associates, a Sand Hill Road venture capital outfit in Menlo Park, Calif. "But a winery will never be a .com stock." ...