SFX Entertainment Flops Badly on Wall Street…

Maybe Wall Street likes coke better than molly.  Which brings us to SFX Entertainment, which is now the latest music-related IPO to crash-and-burn on day one.

SFX was hoping to cash in on the current popularity of Electronic Dance Music (EDM) in the states, but the stock slumped badly on day one.  After a lukewarm taking, shares of SFXE dipped into the $10s before landing at $11.86 at the closing bell.

The company was started only a year ago by Robert F.X. Sillerman, who “corporatized the concert industry in the 1990s” and ultimately quintupled the price of your concert ticket.  SFX bought up Beatport and the company behind TomorrowWorld, and is planning on using IPO funds to buy the company behind Electric Zoo.

The question is now is whether this dud can dance, and more inportantly, whether Wall Street sees SFXE as more than just a consolidated fad.

6 Responses

  1. cjhoffmn

    I haven’t read the S-1 yet, but 1st day performance doesn’t really mean that much. Especially since the company is trying to roll-up something that’s still growing. It will be very interesting to watch if the integration into a corporate entity kills the growth of the EDM scene though – that’s for sure.

    • Visitor

      This piece of hoo haa is going sub $2 real fast
      Watch this piece of garbage sink into the hole of Wall Street’s bowels — then it gets delisted then dumped onto the next Michael Rapino, who spends the next 10 years running it into the ground.
      Rinse, Repeat, Rinse, Repeat
      Sillerman wins again!

    • polka

      Hey Hoffman,

      Looks like another one of your brethern (aka Madoff) Sillerman is a dirt bag thief.

      Hope you all burn…

  2. Stephen Aristei - Creative Tal

    It depends upon what is being bought and what is being sold….Is the youth truly “buying a lifestyle”, and can that “lifestyle” last long enough and develop deep enough to create a lasting market so that business and industry can in fact “sell” to it ? ?
    I am still not sure….Purchasing the intrastructure of the business seems to me to be pretty “riskey” and one runs the risk if it, as a “lifestyle”, faulters and starts to decline, could end up being the last to know !
    I think EDM is still developing and changing and the “lifestyle” attached to it is also doing the same…..I don’t think it has the “foot-hold” in the youth culture that the owners of SFX believe….not to say it still won’t develop in to it…..It already has “legs”, just as the “hoolahoop” had “legs”…but then all “fads” do….and some “fads” last longer than others…..I am not saying that EDM is a “fad”…No I think it is a very real force in music, but it is still in a very developmental stage…..and it’s “market” is still very much in “flux”…..and time will tell how influencital a force it may become.

  3. think about it

    Is Woodstock in it’s original form still around? no.

    young markets only do one thing. change.

    EDM (i hate that term), started in Detroit warehouses (let us not forget), and was ultimately an escape from corporate music & lifestyle. To put it on the stock market is a business and ethical failure. Kids love to rebel. The next cool kids will start their own thing, it’ll get traction on microblogs, and that’s the end of EDM.