Adam

BigBand Network: No Big Deal

While it amazes me that BBND is doing so poorly in a market that is both growing and dynamic, my posting is more focused around your comment regarding executives selling alongside the public offering. It is not uncommon for founders in private transactions to benefit from the sale of the company when it occurs while the employees wait for some period to expire. The logic is that when the liquidity event occurs, the founders have completed the task set for them by their initial investors and therefore its appropriate that the founders get paid. When you consider the many years effort and dedication it took the founding team at BBND to get to where they are today, and the financial sacrifices startup executives make compared to operating company executives, I believe it is very reasonable to allow founders to sell alongside the public offering. They are simply being paid for their historical effort. (think of it as backpay)

In terms of the IPO, investors invested in both the market and the company, BBND. The market opportunity should be the primary focus of the investor followed by BBND's ability to successfully grown their share of that market. As such, investing because of a single quarter that BBND stated was "outstanding" is based on incomplete analysis and seems unwise. Of course, the current stock price is representative of the management teams ability to compete in their market, and the market measures this performance in a very dispassionate way.

Adam