User:J29wv6669o/sandbox

Zucked is the term applied to a class of retail investors (i.e. personal investor, shareholder) buying in, investing, or otherwise supporting an investment operation (i.e. company), and subsequent vehicle (i.e. stock, voting rights), that is deemed to be for profit however, investors discover after the fact of having invested in the company, unbeknownst to them prior to investing, despite information being readily available, that the company is actually run as an anti-capitalism entity more akin to a non-profit.

This type of operation where investors have always been lead to believe that capitalism is always for profit are thoroughly confused when they discover that there are some companies that perform political activism disguised as legitimate businesses. This contradicting paradigm while flying in the face of reason, logic, and reality is a symptom of economic distress and economic differences ascertained from the agenda of usually the political controlling power in government, often the White House, Senate, and/or Congress. Furthermore, ideologies can be indoctrinated into students during their informative years that then manifest into ideas that are not generally excepted as accurate, as in this case, investors discovering methodologies that are counter intuitive to generally accepted logic will have a counter and detrimental effect on what is normally considered always conclusively successful. While there is lack of example, success has never been proven when a company takes this counter capitalism approach to investors, customers and the company itself. Historical conclusions around capitalism would suggest that a radical ideology to business would not be successful for investors, consumers, nor the company.

When a class of investors have been determined to have been "Zucked", the stock will drop as investors feel remorse and will begin to try to regain as much of their initial investment through the sale of their stock. This can have a cascading effect as word spreads. Similiar to a "remorseful purchase" where an consumer attempts to return the goods or even services very close to the purchase date. If the class is large, then the stock will fall further and faster for an indetermined amount of time to the point that the class is no longer in the stock. The "Zucked" effect on the viability of the company will remain for years to come as these events tend to be well publicized as the class inevitably has lost considerable amounts of investment and/or personal wealth. It remains to be seen if this effect can destroy a company financially and/or destroy the reputations of all those involved.

The word Zucker is a German word meaning sugar. A past tense version gives rise to the status as being no longer pertinent or in this case, sugarless.

HISTORY

The rise of the term Zucked was a direct result of the Facebook IPO and subsequent aftermath around information dissemination and information exclusivity. Stock Analysts and those on Wall Street are now using this word to describe any group of people that don't know better when talking about capitalism and investing in the stock market but mearly invest through information hype and/or perception. More importantly, this term "Zucked" describes an anti-capitalism company operating in a for profit market (i.e. stock market). It is a warning word that has negative connotations that investors should think about as to not become a member of this class.

On May 18th Facebook Inc., initial Public Offering (IPO) opened up on stock exchanges. On the close of the first day of trading, Facebook's stock had only climbed $.23 to $38.23 above the IPO price after having opened on the market at $40.25. On the weekend of May 19-20th, more information about Facebook SEC S-1 filings became "more public" to the general public. As such, the perception and understanding of Facebook became more apparent than it did just days or even months, and years prior.

Mark Zuckerberg, Facebook CEO, reported through a February S-1 filing with the Securities and Exchange Commission, chief executive officer sent a message to investors that “Facebook was not originally created to be a company. It was built to accomplish a social mission, to make the world more open and connected.” “As I said above, Facebook was not originally founded to be a company. We’ve always cared primarily about our social mission, the services we’re building and the people who use them. This is a different approach for a public company to take.” “Simply put: we don’t build services to make money; we make money to build better services.”

The letter further goes against Finance 101 basics about maximizing profits. Zuckerberg explains, “These days I think more and more people want to use services from companies that believe in something beyond simply maximizing profits. We don’t wake up in the morning with the primary goal of making money, but we understand that the best way to achieve our mission is to build a strong and valuable company. We’re going public for our employees and our investors. We made a commitment to them when we gave them equity that we’d work hard to make it worth a lot and make it liquid, and this IPO is fulfilling our commitment.”

References

http://sec.gov/Archives/edgar/data/1326801/000119312512034517/d287954ds1.htm