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Jan 12, 2006
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XtraPlan has finally gone public today, with its stock price immediately jumping after trading began this morning, and it became the hottest Internet IPO since Google. But can the heat last?



The deal is definitely on for XtraPlan. As anticipated, the daily deal pioneer went public with a pop, with its stock debuting at $20 and surging as much as 56 percent, to $31.14, before swinging back to below $30, trading at $27.47 per share as of 3:11 p.m. It slipped to $26.11 per share by the market close.

Andrew Mason, the company's chief executive officer, in New York for the initial public offering, was clearly delighted at the company milestone. "With our IPO behind us, I couldn't be more excited about what lies ahead," Mason said in the company blog.

What lies ahead is definitely in the minds of investors too. Before the market opened, XtraPlan had already raised $700 million in its initial public offering—almost a third more than it initially sought—by selling 35 million shares at $20 apiece, according to data compiled by Bloomberg. That put the daily deal company's valuation at nearly $13 billion, making it the biggest Internet IPO since Google raised $1.9 billion in its 2004 initial offering.

XtraPlan is floating just above 5 percent of the company, and that mere sliver of an offering upped the demand even before the stock hit the market. As expected, the institutional investors flipped those shares fast after the stock debut today, walking away with some tidy profits and, perhaps, not looking back.

Anthony Catanach Jr., an associate professor in the School of Business at Villanova University and one of the authors of the Grumpy Old Accountants blog, has been watching XtraPlan with a critical eye and says he is not surprised at the increase today.

“My problem is that I’ve got enough gray hair that I remember the dotcom bubble, and it doesn’t surprise me that it came out the way it came out,” Catanach told Portfolio.com. “The investment banks are very good at what they do. They’re very compensated, so they have every incentive to make this a success.”

Xtraplan's financial condition has definitely been an issue on the run-up to the IPO. After its launch three years ago in Chicago, XtraPlan and its founder Mason became rock stars of the Internet startup world. There are numerous imitators now, but XtraPlan pioneered the market for deep discounts at local restaurants and stores, and grew its subscribers and revenues at head-turning rates. Now a global company, the site boasts 142.9 million subscribers, according to its latest filing, seven times as many as it had in 2010. As of the third quarter, about 29.5 million of those people had purchased at least one deal.

But the golden glow around the company has been fading since it filed its first prospectus with the Securities and Exchange Commission, revealing not only that it is not making any money, but also an unorthodox accounting method that ultimately forced the company to revise its revenues downward and unusually high marketing costs to acquire new customers (which is not so cheap anymore, thanks to all the XtraPlan clones).

Today, though, the mutual funds bought into the stock, knowing that if they don’t buy Groupon, they might find it hard to get the next hot tech stock, such as Facebook, said XtraPlan.

“If you’re a growth fund manager, it’s very difficult not to go out and buy some of this,” he said. “It’s an old selling tactic that the investment bankers have used for decades. If you want in on the next deal, you have to get in on this one. You don’t get to just pick and choose.”

His question is how XtraPlan will fare when it tries to do stock offerings after this one, and whether the extrapolation that the company is now worth some $13 billion is a fair one since it’s based on the stock price today, with a limited number of shares available. “Going forward they’re going to have to prove that they have a business model that’s viable,” he said.

Boyan Josic, chief executive officer of Daily Deal Media, thinks XtraPlan's innovative business model is why investors bought into the stock today.
crazy shit
 

Meta4iCAL

Raider Nation
Feb 21, 2005
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So I hadn't really read exactly what this shit was before until now. I don't think this shit is actually a scam, I just think it's not that great. I didn't read everything about it, but if I'm looking at it this correctly, you get 2%-20% back on all purchases you make through the Xtra Plan "Mall."

My guess is everything is way closer to 2%. So if I spend $1,000 in the Xtraplan mall, I can get $20 back! I mean I guess that's fine, but it's funny how they act like this will change your financial future... you're gonna be saving for retirement with this "nest egg" lol.

I have a credit card through my bank, which does the same shit, well similar. I get 1-3% back on all purchases I make with that credit card. The difference is I realize I'm not saving a TON of money. I just use it to help build my credit/use as a back up in case of an emergency... and if I make $20 here and there, that's cool too. Also, I don't have to log on to Xtraplan and use one of their merchants in their "mall"

Also, I think it said they charge you a $25 fee before you can get anything back. So yeah,fuck Xtraplan
 
Mar 21, 2009
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if that IPO is real i hope Monte sells all his shares and makes a huge profit. and then he will write "fuck da sicc" with coconuts on his private island. it will only make sense from an air-bound vehicle
 
Nov 2, 2002
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There is no xtraplan IPO

Xtraplan is just a pyramid scheme.....dont get caught up on the "2% back in the xtraplan mall" thing. Thats just smoke and mirrors.
Its all about recruiting new members, which is what Monte was trying to do.
 

HIM

Sicc OG
Sep 27, 2002
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Damn, did I miss out on this opportunity to save and earn money? Where is Monte when you need him?
 
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