After media, Wall Street, and government scrutiny over its involvement in the “meme stock” frenzy in early 2021, Reddit, Inc. (“Reddit”) finds itself in the spotlight again. (Taylor Tepper & Benjamin Curry, Forbes). This time, Reddit attracted attention from the Securities and Exchange Commission (“SEC”) by filing a confidential initial public offering (“IPO”) on December 15, 2021. (Id.; Reddit Announcements). Reddit’s valuation stands at approximately $10 billion after its most recent funding round garnered $700 million. (Taylor Tepper & Benjamin Curry, Forbes). However, the confidential nature of Reddit’s filing means that it is not required to publicly disclose financial data until far later than usual in the IPO process. (Sergei Klebnikov, Forbes). . .
Read MoreThe ongoing federal prosecution of fallen biotech wunderkind Elizabeth Holmes showcases the dangers investors—along with patients and doctors—face as companies make encouraging promises in a climate of rapidly emerging technology. Elizabeth Holmes dropped out of Stanford University and founded Theranos, Inc. (“Theranos”) in 2003 seeking to “revolutionize the blood-testing industry.” (Sara Randazzo, The Wall Street Journal; Eric Mack, CNET; Daniel Thomas, BBC News). The Silicon Valley firm claimed to be developing technology that required a smaller draw of blood than traditional lab tests and touted the convenience of using its test kits compared to sending samples into lab centers. (Eric Mack, CNET). After crafting partnerships with healthcare and consumer giants Walgreens Boots Alliance and Safeway, Inc., Theranos’ valuation skyrocketed to a peak of approximately $10 billion. (Sara Randazzo, The Wall Street Journal; Zaw Thiha Tun, Investopedia). Then, in 2015, a whistleblower alerted the Wall Street Journal to Theranos’ allegedly deceptive practices. (Sara Randazzo, The Wall Street Journal). . .
Read MoreIn 2020, investors looked to make a quick buck using novel investment schemes such as driving up the price of “meme-mania” stocks using social media. (Russell Investments, Seeking Alpha). One of the most popular get-rich-quick schemes in 2020 was to invest in special purpose acquisition companies (“SPACs”). Id. SPACs are “blank check” public companies established to use investors’ capital to find and purchase private companies—a process known as a reverse merger—which private companies then become publicly traded. (Scott Deveau, Bloomberg Law; David Stein, Money for the Rest of Us). By May 2021, initial public offerings (individually, an “IPO”) of SPACs raised $100 billion in capital, already matching the total capital raised for SPACs in 2020 and setting a record for capital raised in SPACs in a single year, with over six months remaining in calendar 2021. (Russell Investments, Seeking Alpha; Emily Graffeo, Business Insider). . .
Read MoreAs the climate change cloud darkened over the United States, American investors called for greater climate risk transparency from corporations. In December 2020, the Securities and Exchange Commission’s (“SEC”) subcommittee of Environment, Social, and Governance (“ESG”) acquiesced to these demands, “issu[ing] a preliminary recommendation that the [SEC] require the adoption of standards by which corporate issuers disclose material ESG risks.” (Allison Herren Lee, SEC Public Statement). To establish a clear and educated ESG disclosure framework, the SEC called for public comments from investors and market players on climate change disclosure. Id. This article discusses those comments, why some companies take issue with reporting ESG risks, and which form ESG disclosures might take. . .
Read MoreBitcoin has certainly become all the rage in the past few years. Its price captures the world’s attention, whether it rockets upwards or plummets downwards.
But now that Bitcoin’s price has been hovering around $60,000 between April 10 and April 18, 2021—higher than ever before—legendary investor Ray Dalio predicts that the United States government will likely ban the cryptocurrency. (Billy Bambrough, Forbes). He claims that no country, including the U.S., wants to compete with another currency for monetary hegemony. Id. A quick dive into the history and law surrounding Bitcoin and American currency itself will help clear up Mr. Dalio’s surprising claim…
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