Author Topic: SYTE - Enterprise Diversified  (Read 210445 times)

KJP

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Re: SYTE - Sitestar
« Reply #200 on: September 19, 2016, 04:35:41 PM »
So beyond all of the obvious problems, no ownership of the GP? Just passive investment as LPs, paying the manager a fee?  Apparently by "asset management business" SYTE means that it will be paying fees to asset managers.

Although Sitestar isn't getting an equity stake in the GP, it is getting a portion of the management fees generated by the fund, according to a letter that Alluvial sent to its clients.


stahleyp

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Re: SYTE - Sitestar
« Reply #201 on: September 19, 2016, 04:37:25 PM »
I've not kept up with this a lot but if they seeded with $10 million and got no ownership stake that is wild. I believe even MKL got a piece of good haven (granted it was a mutual fund and not a hedge fund but still) when they helped seed them.
Paul

NeverLoseMoney

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Re: SYTE - Sitestar
« Reply #202 on: September 19, 2016, 04:44:33 PM »
I think shareholders who bought shares when Frank Erhartic was still CEO don't have that much to complain about, really.
So you're saying because Steve Kiel is only slightly worse than Erhartic, investors should be happy with what they've got?
I'm saying those early investors mainly have themselves to blame if they do feel unhappy today. I'm certainly not saying Steven Kiel is worse than Frank Erhartic.
I think many people only became involved in this company after reading Jeff Moore's posts about Sitestar on his blog.
Nonsense. Most people got involved because of the cash flow generated by the internet business.
How many people would even have bothered to look at this company, let alone invest in it, if it were not for those posts on Jeff's blog?
Jeff is a smart fellow and provided insight, no doubt whatsoever, but the company was followed before he got involved.
Fair enough. I don't know what moved people to invest in Sitestar. My impression is that those posts by Jeff gave at least some investors the feeling that they got to know Frank Erhartic and that this feeling gave them increased confidence in the investment. If so, they were very wrong.
I think anyone who first invested when Mr. Erhartic was in charge deserves a huge loss on their investment.
This is a ridiculous statement. Just because Erhartic was a lousy CEO, it doesn't automatically make Sitestar a zero.
I didn't say "a zero". I am saying that if you invest in a company where the CEO has a large stake in the business and he engages in the kinds of acts that are being described in the lawsuit, then you're going to get a terrible result if that CEO keeps running the show for many years. So activist intervention was required to salvage the situation. If people aren't happy with the activists that turned up and what they did subsequently, than that means that they shouldn't have invested in a company that required intervention. I think investors should own up to their mistakes. We all make them. The only question that matters after making one is: what could I have done differently? I just see a lot of finger-pointing, but no people that admit they got it wrong by investing in this company when Mr. Erhartic was the CEO.
Luckily small shareholders received a huge bailout, because thanks to the efforts of large shareholders Jeff Moore, Steven Kiel and one or two others, value can now be salvaged instead of it continuing to be destroyed by the former CEO.
You have a funny definition of a bailout. But yes, value is being salvaged, it's been salvaged for the benefit of Steve Kiel.
My impression of Steven Kiel is different than yours, but I could be wrong. Other investors don't seem to see things as negatively yet, the stock hasn't declined much after today's news. I would have expected at least some large shareholders to be selling strongly, judged by the posts of some large holders in this thread.

ScottHall

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Re: SYTE - Sitestar
« Reply #203 on: September 19, 2016, 05:43:34 PM »
If you guys have a problem with what they're doing, maybe you should put up or shut up. Complaining isn't going to solve any of the perceived problems.

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TBW

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Re: SYTE - Sitestar
« Reply #204 on: September 19, 2016, 05:47:07 PM »
I don't think people are thinking about this dilution correctly.  Sure your ownership percentage is less but given that the cash is coming to the company your asset base is a lot higher.

For example even at the really low price of 0.048 your dilution in my estimation is only ~10%.  The previous raise was more like 20%.  So to keep it simple call it 30% all-in.  These guys have tracks records in the 20% annual return range so if you ascribe any value to that  (which you certainly don't have to) say a dollar raised this year makes a 20% return and discount it back at a rate of 10% to today, that would add back ~9%.  So you are looking at dilution in the range of 20 to 30%.  I am not sure that is as terrible as everyone seems to think.  If one looks at the high stock price of .08 (not that many shares actually changed hands there) it's only down 14% from there.  So unless a seller is motivated the mkts appear to be seeing this the way I am.

Initially I too really did not like the price, the mechanism to raise capital and also did not understand the quorum issue.  I emailed management, they responded immediately and after a discussion I really think they are doing the right thing given the situation at hand.  I strongly urge you to reach out and I would be surprised if you didn't think so too after speaking to them.

I personally think management is doing some impressive things.  I did not know them prior to meeting them today at the meeting and came away very impressed.

I think if one was to take issue with their strategies or future plans for the company that is fine as everyone looks at business opportunities differently and everyone is entitled to their opinions.  However taking issue with the character of management given the capital raises is misguided until you hear the whole story.

matts

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Re: SYTE - Sitestar
« Reply #205 on: September 19, 2016, 06:10:04 PM »
I don't think people are thinking about this dilution correctly.  Sure your ownership percentage is less but given that the cash is coming to the company your asset base is a lot higher.

For example even at the really low price of 0.048 your dilution in my estimation is only ~10%.  The previous raise was more like 20%.  So to keep it simple call it 30% all-in.  These guys have tracks records in the 20% annual return range so if you ascribe any value to that  (which you certainly don't have to) say a dollar raised this year makes a 20% return and discount it back at a rate of 10% to today, that would add back ~9%.  So you are looking at dilution in the range of 20 to 30%.  I am not sure that is as terrible as everyone seems to think.  If one looks at the high stock price of .08 (not that many shares actually changed hands there) it's only down 14% from there.  So unless a seller is motivated the mkts appear to be seeing this the way I am.

Initially I too really did not like the price, the mechanism to raise capital and also did not understand the quorum issue.  I emailed management, they responded immediately and after a discussion I really think they are doing the right thing given the situation at hand.  I strongly urge you to reach out and I would be surprised if you didn't think so too after speaking to them.

I personally think management is doing some impressive things.  I did not know them prior to meeting them today at the meeting and came away very impressed.

I think if one was to take issue with their strategies or future plans for the company that is fine as everyone looks at business opportunities differently and everyone is entitled to their opinions.  However taking issue with the character of management given the capital raises is misguided until you hear the whole story.

OK, so can you fill us in then?

InelegantInvestor

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Re: SYTE - Sitestar
« Reply #206 on: September 19, 2016, 06:18:42 PM »
If you guys have a problem with what they're doing, maybe you should put up or shut up. Complaining isn't going to solve any of the perceived problems.

No position.
How would you suggest we go about "putting up"?

InelegantInvestor

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Re: SYTE - Sitestar
« Reply #207 on: September 19, 2016, 06:21:35 PM »
I don't think people are thinking about this dilution correctly.  Sure your ownership percentage is less but given that the cash is coming to the company your asset base is a lot higher.

For example even at the really low price of 0.048 your dilution in my estimation is only ~10%.  The previous raise was more like 20%.  So to keep it simple call it 30% all-in.  These guys have tracks records in the 20% annual return range so if you ascribe any value to that  (which you certainly don't have to) say a dollar raised this year makes a 20% return and discount it back at a rate of 10% to today, that would add back ~9%.  So you are looking at dilution in the range of 20 to 30%.  I am not sure that is as terrible as everyone seems to think.  If one looks at the high stock price of .08 (not that many shares actually changed hands there) it's only down 14% from there.  So unless a seller is motivated the mkts appear to be seeing this the way I am.

Initially I too really did not like the price, the mechanism to raise capital and also did not understand the quorum issue.  I emailed management, they responded immediately and after a discussion I really think they are doing the right thing given the situation at hand.  I strongly urge you to reach out and I would be surprised if you didn't think so too after speaking to them.

I personally think management is doing some impressive things.  I did not know them prior to meeting them today at the meeting and came away very impressed.

I think if one was to take issue with their strategies or future plans for the company that is fine as everyone looks at business opportunities differently and everyone is entitled to their opinions.  However taking issue with the character of management given the capital raises is misguided until you hear the whole story.
Yes my asset value was not fully diluted, but my voting rights were.  I have emailed management and have generally gotten no response. I believe I have heard the whole story. If there is more to it, by all means, share it.

InelegantInvestor

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Re: SYTE - Sitestar
« Reply #208 on: September 19, 2016, 06:23:30 PM »
What a circus.

The value investing community love throwing stones about shareholder representation and ethics from the outside but once a pot of gold is in sight the average value investor has the same motivations of greed as any other.

This nonsense about a satisfactory end justifying questionable means is the same backwards thinking that prevents people like Biglari from being held to account.
Biglari is an apt comparison. How long before the company changes its name to Kiel Holdings?

Spekulatius

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Re: SYTE - Sitestar
« Reply #209 on: September 19, 2016, 06:54:54 PM »
This is an Animal Farm and we know who the pigs are.
To be a realist, one has to believe in miracles.