Grab - It never rains but it pours

As the saying goes, "It never rains but it pours."

This morning, I read a Business Times article that ride-hailing and delivery platform Grab is at risk of U.S. class action lawsuits after its share price plunged recently [news].

Several U.S. law firms are taking advantage of the situation to entice Grab shareholders to come forward and take up their offer for litigation against the company management.

While the investigation may reveal no just cause for a lawsuit, I believe the reputational damage is done to Grab. Existing and potential investors may be spooked by the possibility of legal costs further draining the company coffers and distracting the management from focusing on the business.

Getting a U.S. public listing may be glamourous. But it does have its inherent dangers too.

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Grab ($$$ while you can)

This morning, I read a news article on Bloomberg about ride-hailing and delivery platform Grab. The stock price plunged 37% after the company reported wider losses in its fourth quarter [news].

I can never understand why folks will invest in unicorns that burn cash by the millions (this applies to Sea too). Companies are meant to be profitable entities. A free capitalist market ought to channel money to those that can generate positive returns.

Perhaps that is why I can never be a technologist. Haha. I don't foresee how Grab or Sea can turn the situation around, when the barrier of entry is low and competitors are aplenty. Every startup seems to believe they can become the dominant player in the market.

The massive share price plunge indicates speculators are controlling the company shares, not investors. And when you don't have a steady investor base, the stock is bound to be wrapped up in volatility.

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