“Red Hat came to market at $14 a share last week and closed its
first day up 270 percent at 52, grabbing headlines in the financial
press. On the following day (Thursday) it rose a further 20 points
and finished the week a further 13 higher at 85 1/4. This values
Red Hat at above $5 billion. The success of the IPO will provide
Red Hat with all the early funding it might need to pursue its
business goal. Tipping its red hat to the open source community, to
which it owes almost everything, Red Hat set aside, ‘800,000 shares
of common stock for sale at the initial public offering price
through a directed share program, to directors, officers and
employees of Red Hat and to open source software developers and
other persons that Red Hat believes have contributed to the success
of the open source software community and the growth of Red
Hat.'”
“The gesture was greatly appreciated and also excellent PR.
However there were glitches with it. Some who tried to take
advantage of the offer were denied the possibility by SEC
regulations which imposes minimum requirements for participating in
an IPO. Others were denied by E*Trade, Red Hat’s brokerage partner
whose web site kept giving would-be shareholders error messages.
This is egg on E*Trade’s face rather than Red Hat’s.”