Several years ago, a Wall Street Journal article referenced the financial activities of persons who had made millions as Intellectual Property (IP) lawyers. A reader may not think of the columnist as a worker producing a story, needing to collaborate and gain approval for publication. Consequently, if a journalist or other media simply lionizes attorneys, and political news networks still exude them as correspondents, there can be an influence that compromises one’s will to achieve.
Rideshare companies such as Lyft (LYFT) and Uber (UBER) are in the middle of a dynamic power struggle that seems to be increasingly adverse to them. Since their share prices are well above zero, some investors must still bank on them as part of society’s future. However, it is evident that these companies might be described as “Litigation stocks.” They are being sued and regulated in different jurisdictions all over the country and are paying up for their defense.
Any publicly-traded corporations that are illustrative of progressive business practices are unknown. There appears to be nothing nascent on the horizon either. You can have leftist orientation or culture. Several of the tech giants are identified with it. Still, candidate Elizabeth Warren cites President Teddy Roosevelt as a trust buster in support of her claim that they need to be dismantled. (It is unlikely she would invoke a controversial endorsement of the Dingley Tariff, enacted when he served as vice president under William McKinley and maintained when he succeeded his former boss after an assassination.) Past businesses, and underlying aspects of society that they involve, get destroyed and extraordinarily wealthy entrepreneurs on the other side of the process buy them with what might be pocket change. Examples include The Washington Post and Time Magazine. Beyond that there is little that is both central and about helping the disadvantaged.
However, one of the prevailing issues confronting rideshare companies is multifaceted: compensation to workers. Arguably, prescient backers–probably before the advent of Lyft investor Carl Icahn, who I used to admire prior to his recommendation of EPA chief Pruitt, being oblivious to asbestos issues at his company Federal Mogul–might have implemented a scheme to compensate drivers with stock. Of course it is not what they did. They deem legal representation worth paying for however, and their counsel is probably cashing in on past pro bono service.
The following Tweet is by an evidently popular online personality, who unsurprisingly is not identified as an investor outside his own media firm:
Anyhow, though not prepared to separately claim, as a rule, that stocks that are identified with litigation markedly underperform, it has been a consistent observation. Further, investors are risking funds that may be diverted to attorneys who are paid better, which is a result. It would be a matter of recognizing an unfavorable situation.
I saw this in a publicly-traded biotechnology firm. The stock languished amid volatility for months and years. Different companies sued it for patent infringement and it hired the best in the business to defend its ownership of its product. The particular company issued new shares of stock, after having repeatedly done so, in part to pay its legal bills.
These matters are quite different from employee compensation. Those who occupy the upper portion of the hierarchy will be extraordinarily wealthy regardless. Of course a lot of a corporation’s employees are not as well paid as its legal counsel. Meanwhile underperforming professional investors pass along losses to their clients. The point to be made, and my own bet, is that Lyft’s current backers are slow to recognize that attorneys are being paid better than them, or their clients.
Evidently, the company is striving toward profitability faster than one might have anticipated. It raised all sorts of cash recently, so betting against it is not a matter of a near-term cash crunch. Yet it is a business model that is under attack. I suspect some future state transportation fundraising initiatives would be compared to Hannibal’s ambush at Lake Trasimene, if Lyft’s leaders heard of the ancient rout. That would be an exaggeration, but there is going to be negative news flow and costly matters.
Lyft is paying up to defend itself, which is not about to end anytime soon. However, when the share price rises it makes sense that selling the stock will be palatable to those who recognize what they’ve gotten involved in. Over time, the sellers may prevail.
Rideshare companies such as Lyft (LYFT) and Uber (UBER) are in the middle of a dynamic power struggle that seems to be increasingly adverse to them. Since their share prices are well above zero, some investors must still bank on them as part of society’s future. However, it is evident that these companies might be described as “Litigation stocks.” They are being sued and regulated in different jurisdictions all over the country and are paying up for their defense.
Any publicly-traded corporations that are illustrative of progressive business practices are unknown. There appears to be nothing nascent on the horizon either. You can have leftist orientation or culture. Several of the tech giants are identified with it. Still, candidate Elizabeth Warren cites President Teddy Roosevelt as a trust buster in support of her claim that they need to be dismantled. (It is unlikely she would invoke a controversial endorsement of the Dingley Tariff, enacted when he served as vice president under William McKinley and maintained when he succeeded his former boss after an assassination.) Past businesses, and underlying aspects of society that they involve, get destroyed and extraordinarily wealthy entrepreneurs on the other side of the process buy them with what might be pocket change. Examples include The Washington Post and Time Magazine. Beyond that there is little that is both central and about helping the disadvantaged.
However, one of the prevailing issues confronting rideshare companies is multifaceted: compensation to workers. Arguably, prescient backers–probably before the advent of Lyft investor Carl Icahn, who I used to admire prior to his recommendation of EPA chief Pruitt, being oblivious to asbestos issues at his company Federal Mogul–might have implemented a scheme to compensate drivers with stock. Of course it is not what they did. They deem legal representation worth paying for however, and their counsel is probably cashing in on past pro bono service.
The following Tweet is by an evidently popular online personality, who unsurprisingly is not identified as an investor outside his own media firm:
Nobody seems to win these days.— Tom Goodwin (@tomfgoodwin) November 3, 2019
Typically the marketplace layer (Uber,Grubhub, Handy,Amazon etc) is burning vast piles of VC cash,while the workers delivering are paid tiny amounts.
All we’re doing is spoiling customers into unreasonable expectations while killing the planet https://t.co/QGfjM6uvy1
Anyhow, though not prepared to separately claim, as a rule, that stocks that are identified with litigation markedly underperform, it has been a consistent observation. Further, investors are risking funds that may be diverted to attorneys who are paid better, which is a result. It would be a matter of recognizing an unfavorable situation.
I saw this in a publicly-traded biotechnology firm. The stock languished amid volatility for months and years. Different companies sued it for patent infringement and it hired the best in the business to defend its ownership of its product. The particular company issued new shares of stock, after having repeatedly done so, in part to pay its legal bills.
These matters are quite different from employee compensation. Those who occupy the upper portion of the hierarchy will be extraordinarily wealthy regardless. Of course a lot of a corporation’s employees are not as well paid as its legal counsel. Meanwhile underperforming professional investors pass along losses to their clients. The point to be made, and my own bet, is that Lyft’s current backers are slow to recognize that attorneys are being paid better than them, or their clients.
Evidently, the company is striving toward profitability faster than one might have anticipated. It raised all sorts of cash recently, so betting against it is not a matter of a near-term cash crunch. Yet it is a business model that is under attack. I suspect some future state transportation fundraising initiatives would be compared to Hannibal’s ambush at Lake Trasimene, if Lyft’s leaders heard of the ancient rout. That would be an exaggeration, but there is going to be negative news flow and costly matters.
Lyft is paying up to defend itself, which is not about to end anytime soon. However, when the share price rises it makes sense that selling the stock will be palatable to those who recognize what they’ve gotten involved in. Over time, the sellers may prevail.