Prospectus Probe
Is this a real business or a liquidity exit?
Additional derived signals may emerge during analysis based on company-specific findings.
The Prospectus Probe scrutinizes recently public companies to distinguish genuine businesses from liquidity events for early investors.
This lens asks: "Was this IPO about building a lasting public company, or about cashing out at peak valuation?" The goal is to probe business durability, unit economics reality, insider alignment, and embedded expectations.
This is the most complex single lens — it produces 4 signals because IPO evaluation requires a comprehensive view.
Signals Produced
Revenue Durability
Is revenue structurally sound or dependent on conditions that could change?
Governance Alignment
Are incentives aligned and oversight adequate?
Unit Economics
Are per-unit economics proven and improving?
Expectations Priced
What must be true for current price to be rational?
What This Lens Catches
Profitless growth
Example: Revenue growing but unit economics negative
Look for: Contribution margin, CAC trends
Insider cash-out
Example: Significant secondary offering, early lockup releases
Look for: Use of proceeds, lockup terms
Dual-class structure
Example: Founders retain control with minority economics
Look for: Voting structure, governance provisions
IPO window dressing
Example: Metrics improve dramatically pre-IPO, fade after
Look for: Pre vs post-IPO trends
Proven model
Example: Consistent unit economics, reasonable growth
Look for: Cohort data, margin stability
Analysis Stages
Business Model Reality
Is this a real, sustainable business?
Unit Economics
Are unit economics proven or theoretical?
Governance & Alignment
Are insiders aligned with new shareholders?
Lockup & Selling Pressure
When can insiders sell, and will they?
Expectations Priced
What must happen to justify current price?
IPO Cohort Comparison
How does this compare to similar IPOs?
When This Lens Applies
Apply When
- IPO within last 3 years
- SPAC merger within last 3 years
- Direct listing within last 3 years
Skip When
- IPO more than 3 years ago
- Established public company track record
- Assess accounting manipulation in detail (that's Fugazi Filter)
- Predict stock price
- Make buy/sell recommendations
- Apply to mature public companies
- Provide price targets