Name: Why 1-800-Flowers held an IPO
Uploaded: 2016-07-26
Duration: 3 min 24 s
Description: The company went public more than a decade ago.

[ SOUND ] Can you talk about the decision to take your company public in 1999? What were some of the factors leading up to that? The reason I ask is there's the IPO market right now isn't fantastic for new companies. It's more difficult really for companies to go public so. What's your insight there, how do you know when it's the right moment? And was this kind of something that you had wanted all along? No, it wasn't a want, it was more of a need at that time, so 1990 I mentioned Netscape came long, introduced the browser and all of a sudden the Wild West of the web became organized. People could find their way around, navigate around. It made the Internet start to matter to our business. By 1998 we could see it was going to overtake our business very quickly. We went from really having no competitors in the flower space, Jeremy to having, I think we were tracking 21 financed, privately equity financed competitors and we've been doing that our of our own pocket. Not because we were rich, because we didn't know any better. And so we were starting to wonder, what's going to happen here? We're like in a war for eyeballs as they refered to it at that time. And so we went around to different advisors. And some of them related to this company. Chris and I went down to visit our friends t AOL in Virginia. And Bob Pittman was the president then, Steve Case the CEO, Ted Leonsis was the chair of sorts of everything there. And we went down to visit with them because of the big relationship we had with AOL as we do regularly. And I remember Bob Pittman walking us out to our taxi and we stood chatting in the parking lot. Are you guys thinking of going public? And I said, you know Bob we're not really sure. Why, he said, because you're doing well doing this out of your own resources, but he says, you never know that someone can come along with a lot more money and just overwhelm you brand wise in the market place. He says you ought to think of it, the markets are Interested in company's like yours, you ought to think about it. And so that was the last push we needed to really go take a good hard look at it, which we did. We were fortunate to go public later that year, 1999, August. Goldman Sachs took us public, and we were fortunate that we raised all the money we needed in one shot. Some people said drivel it out into the marketplace, walk up your valuation, And we said, look, we don't know very much about this world. We know this is how much money we'll need to fight the fight however long it lasts, to build our technology platform. So fortunate, we got a terrific evaluation. And we raised all of the money we needed, took some money off the table. And it turned out to be one of the really good decisions we ever made. Anything insightful or lessons that you've learned from that process that could be helpful for entrepreneurs who are considering going public today? Well I think the world's a very different place now Jeremy. And you're seeing more and more companies looking to stay private longer, I think that'll be interesting to see how that plays out. I see some companies getting. Too highly valued, which actually starts to hurt them in term of employee compensation. Employees believing the story in terms of what the worth of their equity compensation. And it may be a good idea, but if it's priced so highly and they don't wanna do a down round, you'll see some companies that, I think, get washed away that shouldn't. They're good enough ideas. But sometimes it can be a victim of their own prior good valuation. [ BLANK_AUDIO ]

The company went public more than a decade ago.