This week I'm taking a vacation -- not a night on the town, not a weekend retreat -- a full-blown "no phones, no laptops, take the kids to Disneyland, walk on the beach and stare into the beautiful blue eyes of the woman I married" vacation. It has been two and a half years since I've done this and I'm long overdue.
Before I go I'd like to share a few thoughts on a topic that drives me nuts. Hopefully, I can put this one permanently to rest and spark your imaginations in the process. If so, my life will definitely be easier and yours might be richer. Read on.
Every week, no, make that
, I hear from at least one of our readers who writes to tell me that I'm a sham. The message usually starts by saying that what I do is of no value to "normal people" because they simply cannot get their hands on IPO shares. They are shut out, disenfranchised, left behind by a greedy Wall Street culture that has turned its back on the little guy. It's a sad story and it's a load of hooey! I am here to tell you that ordinary people -- people with jobs and kids and mortgages -- are getting stock in these deals. I know this because I talk to them all the time. They call me, they write me, they send me gifts (I have a very cool job).
Let me tell you something. Succeeding on Wall Street is not easy. It takes work. It takes planning. It takes effort. Most of all, it takes perseverance and no small amount of common sense. The IPO market is no different. You have to work at it.
One of the most common stories I hear from these defeatist types is that they've cold-called a firm like
Morgan Stanley Dean Witter
and were told something like this: "We cannot give you IPO shares unless you have $(some really big number) on deposit with us." On hearing this news, they cease all efforts to get shares and quickly fire off an angry email calling me a huckster. Quitters!
For some weird reason, I found myself thinking about this in the shower this morning. I thought about what I would do if I were a "normal guy" (no wisecracks, please) and I wanted into the game. Here's how I'd approach it:
My first thought is that everybody on the planet is calling Goldman Sachs and Morgan Stanley. This means a big crowd and a long wait if you want to start dancing with these two. I think a better call to make would be to some of the less visible shops that are producing hot deals. Where can you find these underwriters? I'm way ahead of you.
I took a quick look at some of the tools available on the
Web site and right away was able to come up with a short list of underwriters that are both off the beaten path and are producing some heat in the IPO market. I would be willing to bet that
few of you have bothered calling:
- Adams Harkness
- Warburg Dillon Read
- US Banc Piper Jaffray
This is a shame. Aside from producing some pretty hot deals themselves, all three consistently manage to get into the rippin' hot deals of the super elite firms. So, before you whine again that you can't get into the big-money IPOs, get on the phone and make some calls. Your chances of turning a profit will be much higher if you do this rather than send me hate mail. Have a great week.
Let's look at the week ahead:
Ben Holmes is the founder of
ipoPros.com , a Boulder, Colo.-based research boutique (now a wholly-owned subsidiary of TheStreet.com) specializing in the analysis of equity syndicate offerings. This column is not meant as investment advice; it is instead meant to provide insight into the methods of new and secondary offerings. Neither Holmes nor his firm has entered indications of interest in any of the companies discussed in this column. Holmes' This Week in IPOs column appears Sundays, This Week's Secondaries appears Tuesdays, Upcoming Lockup Expirations appears Wednesdays and The Quiet Period appears on Fridays. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Holmes appreciates your feedback at