
Yahoo SEC filing on Viaweb purchase (including Viaweb financials) - byrneseyeview
http://sec.gov/Archives/edgar/data/1011006/0001047469-98-024003.txt
======
run4yourlives
Good Lord.

If anything, having YC people there to walk you through that debacle is worth
the price of admission alone.

Paul, how much of that document did you actually understand when you signed
it, and how much was blind faith in your lawyers? (Serious question actually)

~~~
pg
I consider deal documents to be object code, and my lawyers' explanation of
what's in them to be source code. I inspect the source code fairly carefully,
but I do generally have blind faith in the compiler, in the sense that I don't
read the documents myself to see if the lawyers' interpretation of them is
correct.

From what I've seen, I'd guess this level of understanding of deal documents
is the norm.

~~~
byrneseyeview
After a while it's pretty easy to see past the boilerplate. Has anyone ever
made the analogy literal by creating a language that 1) describes contracts
(like this: <http://szabo.best.vwh.net/contractlanguage.html>), and 2) a
compiler that turns it into something you could upload to the SEC, print and
sign, or whatever?

~~~
briansmith
This is done for contracts between insurance companies and hospitals all the
time. There are also contract compilers and DSLs for financial instruments.

------
dcurtis
Interestingly, the number of shares given outright for Viaweb (393,591), not
including options, would be worth only $7,915,115 today.

edit: (not taking into account splits)

Considering the four splits since the end of 1998, the total number of shares
would be 6,297,456 (393,591 * 2 * 2 * 2 * 2) equivalent to $126,578,866 at a
price of 20.10 (as of 2:04pm edt today).

From June of 1998 to the height of Yahoo's stock in December 1999, two splits
had occurred making the total number of Viaweb shares 1,574,364. With a 108.17
price per share, Viaweb's shares were potentially worth a total of
$170,298,954.

(Assuming they only held on to the 68,210 escrow shares, that still amounts to
272,840 shares after splits and a total of $29,513,102.80 on the day the
escrow period ended.)

Uh, wow.

(This is assuming the numbers I am getting from Yahoo Finance are not
corrected for splits, and I think they are.)

~~~
gojomo
Even with the edits, your estimates are off. Historical prices in a chart are
always split-adjusted. (Otherwise you would see big discontinuous jumps at
each of the split-indicator dates.)

So the reported 108 YHOO high in December 1999 is equivalent to a price of 108
for a current 2008-share.

Thus the peak value of the (393,591 * 2^4) 6,297,456 2008-shares was about
$680 million in December 1999. The other (61,126 * 2^4) 978,016 options
probably added around another $100 million, assuming their strike price was
very low.

Of course, timing is everything, and when the holdings were either hedged or
sold determines how much ViaWeb shareholders actually came away with. A couple
days after the exchange, June 12, 1998, the 6,297,456 2008-shares were worth
about $45 million (at $7.11/share). One year later, when registration lockups
may have expired, they were worth about $212 million ($33.8/share).

~~~
dcurtis
Thanks for clarifying that. I was sure after I realized the charts are split-
adjusted my calculations were off, so thanks for redoing them properly.

------
andreyf
I wonder if this is being upvoted because of a subconscious need to heal egos
after the "YC is Cult" post - a comforting sense of "oh, right, there _is_ a
reason why we love PG/YC/HN".

(or did I just overthink that?)

------
chris_l
Is someone in stalker mode today?

------
fallentimes
Glory days.

Yahoo Net Loss (in thousands): $ (22,887)

Viaweb Net Loss (in thousands): $ (1,747)

~~~
Dauntless
Edit: Sorry I didn't understood at first. Anyway, Yahoo has a $1.03 Billion
Net Income now... <http://finance.yahoo.com/q/ks?s=YHOO> .

------
prakash
good find. The only SEC document that was a pleasure to read was the Google
S1. Lets see how this one is.

~~~
byrneseyeview
It's not fun at all. I recommend it only for the incurably curious.

The only interesting part is how fast Viaweb was growing -- for all of 1997,
they had $343K in revenue; for the first quarter of 1998, it was $290K. You
don't have to extrapolate that too far to see a great deal for Yahoo.

~~~
nostrademons
The other interesting thing was their balance sheet vs. cash flow statement.
For the first quarter 98, they had $106K in cash. In the same period, they
burned $200K on operating activities, and only avoided bankruptcy ($14K at the
beginning of the quarter!) with a $300K cash infusion from investors. They
would've been dead in another month and a half.

Talk about playing chicken!

~~~
pg
It wasn't quite that close. I think we may have had a line of credit we could
draw on.

~~~
akkartik
Did Viaweb have employees by the end?

~~~
pg
Yes, around 20.

~~~
furiouslol
So at what point of time do you and your cofounder stop developing Viaweb
yourself and delegate it to your employees?

