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Comment by londons_explore | Hacker News Reader

The share capital of the company isn't fixed... The company could issue more shares, and invest the money raised, turning the business around.

That wasn't a possibility before, but it is now. Given that, I don't think "the range everyone knows it will fall to eventually" is a foregone conclusion.

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They're not in a promising sector and there's nothing to suggest raising a bunch of money is going to allow them to turn into the kind of company a market cap of $20 billion suggests.

But if they could raise $1 Billion by selling 5% more shares, they could pivot into an entirely new sector using some of their existing assets.

For example, they could make an online gaming platform using their relationships with game studios, or they could move into 'gaming cafes' using their retail space, or start designing games themselves using their storefronts for marketing.

Sure that could happen, but it's just as likely as giving anyone a billion dollars and expecting them to become a company that justifies a $20 billion valuation very quickly. The timing is important too because at the end of a mania like this that is entirely based on a quickly rising price, as soon as enough people decide this isn't going to continue rocketing up, there will be a rush to take their profits or to stop their losses.

Considering how unpleasant it is to talk to a GameStop employee (they upsell you on like 5 different things a purchase), starting a business where people stay longer and talk to them more doesn’t sound appealing for the customer.

they could even become a hedge fund !

> The company could issue more shares

It could, and GME trying to capitalize based on insane stock performance would be a real test of nerve, because it's one thing that could focus the news off the WSB vs institutions narrative and back on the business fundamentals of business, which still suck.

Maybe it works, maybe it just collapses the whole house of cards.

> The company could issue more shares, and invest the money raised, turning the business around.

It’s a retailer that sells video games. They’re not going to turn it around while Steam, PlayStation store, Amazon, etc exist.

With enough capital, they could retool and and do something completely different, like setup a network of local-market-optimized ghost kitchens (or some other completely different business model responding to current opportunities that has nothing to do with what GME does today.) It’d be potentiallty more expensive than building a similar operation from scratch, but if them using the stock price to capitalize doesn't immediately collapse it instead of providing them money (which, to be fair, is far from guaranteed) it's free money that a new business trading on its business plan and not someone else's market manipulation games wouldn't have, so why not?

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