It’s hard to work out the most specular aspect of online luxury goods retailer Cettire’s three-and-a-half year life as a listed company – its moonshot sharemarket rise, its equally spectacular plunge or the fact that its founder has already cashed in $330 million selling stock. To put that into perspective, the company currently has a market value of roughly $434 million. Cettire’s reclusive founder, Dean Mintz.
For investors, there are lessons to be learned from jumping on board a hot stock – hyped by brokers bored by an otherwise uneventful market for the past couple of years in a dearth of new listings. Witness the excitement of this month’s float of Mexican fast food chain Guzman y Gomez : It was the financial media and financial market’s equivalent of the birth of a royal. Anyone looking for anti-Cettire grist can find an abundance on social media – tech guys throwing shade on the business model or mainstream media casting doubt over incorrect collection of import duties, poor customer reviews and even the authenticity of the high-end product it sells.
All of these chinks have opened the door to short sellers – the investors who make money betting on falling share price. So there were a lot of naysayer told-you-sos around this week when the company missed profit expectations by a large margin. And it certainly wasn’t helped by the founder Dean Mintz living up to his reputation as a recluse – which shareholders read as arrogant and unwilling to engag.
