I have to say I love the sound of Xg Technology whose shares started trading in London today.
Xg boasts an outrageously ambitious technology with the potential to wipe out the established wireless telecommunications industry and provide free, or almost free, telephony for everyone.
It’s like the promise of the PC to ‘democratise the computer industry’. And the PC did just that, wiping out a raft of huge computer companies like Burroughs, Wang, DEC, etc.
XMAX, the name for Xq’s technology, claimed to be able to build a pan-US VOIP wireless network for just $15m. Wow!
However not everything was good about Xg. Requests to talk to senior management were refused. The workings of the technology were never explained. Previous ventures by the founders had ended messily.
Today, Xg’s shares started started trading on the London AIM stock exchange after an inauspicious roadshow.
They’d come to London hoping to raise £30m which would have valued the company at £400m, and in fact raised nothing. During the road show of potential investors, the company learned that there was no interest in investing at that level.
But they got their listing, and some of their seed investors sold their shares at $4.50 a pop and that put a value of $287m on the company.
Nonetheless potential investors gave the company non-binding expressions of interest in buying £63m worth of convertible preference shares.
I like the sound of Xq because it’s claiming to be able to do something so totally revolutionary in an age when all the new companies seem to offer only incremental improvements to what is currently on offer.
But now I can actually buy shares in the company, would I do so? Would you? OK, it sounds too good to be true, and that means it usually is.
But Intel set out to reduce the cost of computer memory by 100X. That sounded too good to be true. But they did it.
Comments (7)
Can I just ask how there could be no interest, and at the same time there is interest for 63 million?? There were 600k shares traded the first day. How many were sold at 4.5? Let me answer that..not many. What previous ventures ended messily? How many "seed" investors sold so far? Again, not many. What´s the price of the stock now? 625,000,000 USD in value shows me there is at least some interest. I would venture to say you will "forget" to do a follow up story when the buy in for 63 million happens.
I guess this type of reporting is what we can expect from amateur bloggers like yourself.
Of course the company refuses to comment. Who are you? You obviously have no clue how to fact find other than to search on Google like my 6 year old does.
Posted by Truthseeker | November 25, 2006 11:40 AM
Posted on November 25, 2006 11:40
Thanks Truthseeker, that makes two of us
If you try and raise GBP30m and get nothing that is lack of interest.
If you get a non-binding intention to take GBP63m you can, if you like, regard it as a show of interest, but it's not a very strong show of interest.
The previous venture which ended messily (lawsuits etc) was called iDigi.
I asked for an interview with Xg management because for 28 years I've worked for an electronics trade magazine and usually, when companies come to the stock mareket, they are keen to talk to reporters to get their message across. I did talk to their PR companies in the USA and UK.
As I said in the blog, I love the Xg proposition. If they can get XMAX up and running it will be a massive benefit to everyone who wants inexpensive telephony. I wish them well.
Posted by david manners | November 25, 2006 1:00 PM
Posted on November 25, 2006 13:00
My dad is a fine one to talk about amateurish fact finding. For a start, I am not 6, I am 6 and three-quarters. Also, I do not exclusively rely on Google, I also use altavista, and my friend Colin, his dad knows a lot of stuff.
So there.
Posted by Truthseeker's 6 and three-quarters old | November 27, 2006 2:58 PM
Posted on November 27, 2006 14:58
What is an amateur blogger? As opposed to a professional one? So a professional journalist of 20+ years cannot be a professional blogger?
I guess, if you ask too many questions, pr people will eventually become pissed off. And someday they might come and haunt you.
Asked too many weird questions, David? :)
Posted by VO | November 28, 2006 8:25 AM
Posted on November 28, 2006 08:25
Actually, the XG website did have quite a lot of information.
Quite enough information to decide this was bogus... A stage beyond "perpetual motion from magnets" that we all discovered as kids, but only one stage beyond.
(Hints:
Think about what frequency bands "single cycle modulation" would require
Think about how far line-of-sight from a nice TV mast as. Then ask why they did not do any typical tests)
The Company's actions with David should raise suspicion: management who want talk to the press are unlikely to find life as a public company to their liking.
Posted by Roberto | November 28, 2006 3:34 PM
Posted on November 28, 2006 15:34
Veijo, I have certainly asked too many questions. But that's because of all the lousy answers I get
Posted by David Manners | November 30, 2006 12:57 PM
Posted on November 30, 2006 12:57
Thanks Rupert, that's very interesting and I like the point about the press paricularly. As one who could never get a batsqueak of a reasonable comment out of GEC, Ferranti, Plessey and STC, I much appreciate the attitude to the press of today's companies.
Posted by David Manners | November 30, 2006 1:42 PM
Posted on November 30, 2006 13:42