fastneat

and how were the wages at Allegiant IN THE FIRST FOUR MONTHS of operation? 🤔

Inquiring minds wanna know..

fastneat

^ gets it. 👍

fastneat

Sir, may I make a statement? I have a pilot friend at Breeze who bought in in August 2020. Ten months later when they released B shares, his initial investment at Breeze was valued at 5x. (on top of his options..)

he's pretty good with it.

BeatNavy

Until it’s publicly traded, it’s kind of hard to place a valuation on the company. And that 5x was based on a basically self-proclaimed 1.5bn valuation if I’m not mistaken. Pretty aggressive if you ask me. I’m not saying that early investors won’t do well. It probably will. I’m not arguing the merits of an investment in breeze. I am arguing that they are underpaying, and as a start up, ought to at least be providing equity in the company to compensate for low wages and poor work rules. But, no real reason to do it when “it’s better than my regional, barely” keeps classes full, and attrition doesn’t cancel flights or cost more money in hiring/training than paying enough to keep people.

chihuahua

It appears that Breeze has changed their new hire vaccination policy. At least they've taken a step in the right direction on this one.

TFAYD

it isn’t “self-declared”. Valuations are based on what other internal investors paid for in the subsequent round. And it isn’t just friends and family. There is some real money behind it.

it isn’t liquid but it also isn’t a scam either.

BeatNavy

No. That’s not how valuation of a private company works. You have it backwards. What other investors pay in private company funding rounds is based on the “valuation” and price per share set by the company for that round of funding, and finding those willing to pay the company’s set price for the shares. It isn’t like a public market where there are buyers and sellers setting the price with a bid/ask. Neeleman says hey, we are worth 1.5bn based on my business plan and estimated cash flow projected over the next few years. Here’s ____ number of shares you can buy for ____ price based on this valuation. He phones his PE/HF buddies, they throw down their wads of cash, as well as accredited friends/family/employees at various stages/funding rounds, and again, that’s at the price they set, not at a negotiated or market price (because there is no market, as breeze BOD/mgmt sets that price).

You could say that retrospectively, since banks, PE firms, and people paid ____ per share, the company is therefore worth that price per share for the total number of shares. But, that’s not really a true valuation of the company. This exact discussion was had in one of their interviews/company presentations, and was cited as one of the main reasons why they didn’t want to offer equity—they stated that it gets too muddy with valuations when people want to sell if the company hasn’t IPOd yet.

And last, nobody that I’ve seen in this thread, including me, has said it was a scam, or that there wasn’t real money behind it. $200+ million obviously didn’t come from friends and family, and anyone with that kind of money likely isn’t throwing it on the table without some serious due diligence. Gotta separate the investment thesis/business stuff from pilot compensation. The former is (likely) solid. The latter is not. My argument is that there should be overlap between the two—as compensation ought to include a chunk of the financial risk of going to a startup that underpays via equity that, if successful, will make up for it. But, it doesn’t. Unless you put your own money into it. But that isn’t compensation. That’s an investment, and an entirely different discussion.

AUpilot75

How many have put you on their no fly list..........you must be fun to fly with.

TFAYD

I understand how private companies are valued. And all I was responding to is the notion that the 1.5B valuation is somehow pulled out of thin air.

That valuation was subject to some scrutiny by sophisticated investors. So it isn’t just Neeleman making stuff up but also others - sophisticated PE firms - buying it. And they don’t do it for some charitable reason but believe that they can make money at it.

is it worth 1.5B or just 1B - who knows? But someone believes that they can make a serious return on it - and serious being 30-40% p.a. for this kind of investment risk. That’s all what matters.

Should it be part of pilot compensation? Nobody is forced to work there or to buy shares. It’s a creative way on playing on people’s hopes and dreams. But everyone has to do their own due diligence.

fastneat

Fair enough. Although Black Rock saw something significant in Breeze to inject 200M, so they must also see something there, too, to make that big of an investment, thereby validating the "arbitrary" valuation.

But there's another non tangible that no one here talks about, and that is, most people who are here ACTUALLY love coming to work! It's actually a good feeling when the customers consistently, and i'm not over stating this, but over and over again, they THANK our crews for the nice experience. Just today I was having a conversation with a couple in row 1... I'll say again... HAVING A CONVERSATION with our customers ... and they jokingly asked if we two pilots were the pilots or if we were the on board entertainment?.. (translation.. they were complimenting us for sharing our personalities with them and the whole aircraft. because that is our norm)

How many of you, especially those who keep placing such a focus on money, how many of you can say that your crews and your customers enjoy their flights, express that they enjoy their flights, and enjoy eachother on a crew, as a matter of rule rather than as an exception? How much is THAT worth to you?

Would making more money be better? Of course it would. Does it define my overall satisfaction in my job? Nope. Maslow's hierarchy spells that out for us. If I learned anything coming out of Covid, I learned that life is, can be, could be, IS short. Enjoy every minute of it. Making "industry standard" does not a better life make.