Brew Markets – Episode Summary

Why StubHub Risks A Chill in a Hot IPO Market & Opendoor’s New Team

Podcast: Brew Markets
Host: Ann Berry
Date: September 15, 2025

Episode Overview

In this episode, Ann Berry dives into two of the day’s biggest stories shaping stock markets:

1. Opendoor’s leadership shakeup and what it means for its business and stock
2. StubHub’s hotly anticipated IPO—why it’s both attracting massive demand and raising eyebrows, and what “dual class shares” mean for investors

With expert analysis, engaging banter, and signature clarity, the episode cuts through market jargon to explain risks, opportunities, and the underlying trends for listeners keen on trading and investment developments.

Key Discussion Points & Insights

1. Opendoor’s Massive Shakeup and Stock Surge

[00:02–04:03]

• New CEO and Board Changes:

  • Kaz Nejatian, ex-Shopify executive, becomes CEO.
    • Ann compares his product-focused background to previous finance-heavy leadership.
    • "Kaz's resume reads very differently from that of his predecessor, Carrie Wheeler..." (Ann, 01:11)

• Lucrative Incentive Package:

  • Nejatian's five-year package could land him nearly 12% ownership (~$2.75B value) if Opendoor hits share price targets.

• Founders Return and Fresh Investment:

  • Co-founders Eric Wu and Keith Rabois rejoin the board. Rabois is outspoken about imminent job cuts:
    • “There’s 1400 employees at OpenDoor. I don’t know what most of them do. We don’t need more than 200.” (Keith Rabois, via CNBC, quoted by Ann, 02:13)
  • Rabois and Wu contribute a $40 million investment—small compared to the $7B market cap but a signal of confidence.

• Stock Movement and Analyst Skepticism:

  • Share price up over 50% in a week, but volatility is high.
  • Wall Street analysts mostly issue "sell" ratings with max $2 price targets, lagging behind the news.

• Key Unanswered Questions:

  • Will fundamental strategies under new leadership address cash burn and drive sustainable revenue?
  • "We will report back on whether… the vast gap in belief in OpenDoor…between institutional and retail investors has a chance of narrowing." (Ann, 03:29)

2. StubHub’s IPO: Hot Demand, Cool Headwinds

[04:30–15:54]

• IPO Anticipation and Company Origins:

  • StubHub, having delayed its offering since spring, finally goes public this week.
  • Founder Eric Baker’s journey: Unable to get Lion King tickets → Founding StubHub → Selling to eBay → Founding Viagogo (Europe) → Reacquiring StubHub.
    • "He created Stubhub 25 years ago...to bring liquidity, transparency and trust to the category." (John, 05:19)

• Market Environment & Business Fundamentals:

  • Demand for experiences is high—Gen Z/millennials "prefer experiences over material goods." (John, 07:43)
  • 2024 Stats:
    • 40M tickets sold, 1M sellers, $8.7B gross sales, $1.8B revenue, $255M free cash flow.
  • "I’m excited to break this down with you, because I’m slightly confused as to this valuation." (Ann, 07:01)
  • Target raise: $800M at $8.6B valuation (vs. $17B in private market 2021).

• Competitive Landscape:

  • Main rival: Ticketmaster (owned by Live Nation, $40B+ market cap, venue ownership, primary market dominance).
  • DOJ lawsuit (March 2026 trial) could force Live Nation to spin off Ticketmaster—potentially creating an opening for StubHub.
  • Vivid Seats (SEAT)—another public peer, down 80% this year—illustrates how tough the sector is.
    • "It’s a really difficult area." (John, 12:16)

• Regulatory & Business Challenges:

  • New FTC rule: All-in price transparency mandated (hurts margin opportunities).
  • Artists (like Taylor Swift) pushing for caps on secondary market prices.

• Dual-Class Shares & Founder Control:

  • Eric Baker will hold 10% of economic interest but retain effective control through Class B stock:
    • "…all outstanding shares of our Class B common stock will be held by our founder and CEO Eric Baker… he will have the ability to control the outcome of any act[ion] requiring the general approval of shareholders…" (Ann, 13:20, reading IPO filing)
  • Despite going public, control does not dilute.

• IPO Math & Financial Skepticism:

  • Profit declines: From $350M to $300M, amidst $830M in marketing spend and $2.3B in debt.
  • At IPO, will still be “five times levered”—a heavy debt load.
  • Valuation: 30x EBITDA, vs. Live Nation at 17x—“I don’t understand why, to be perfectly honest. Not investment advice, one person’s view.” (Ann, 14:43)

3. Jargon Bust: Dual-Class Shares Explained

[15:56–18:47]

• Listener Question: Taylor from Indianapolis asks: “What are dual class shares?”
• Ann’s Clear Explainer:
  • Usually, “one share, one vote”; but dual-class structures split economic and voting rights.
  • Example: Alphabet (Google’s parent) with Class A (public, 1 vote), Class C (public, no vote), Class B (insiders, 10 votes), giving founders outsized control.
  • “Next time you see dual class shares, think of it as two flavors of ownership—one for control, one for bringing in cash.” (Ann, 17:33)
  • Debate: Supporters say it enables long-term vision; critics say it erodes “shareholder democracy.”
    • Cites Elon Musk/Tesla as another contemporary illustration.

4. Rapid Market Updates

[18:56–19:44]

• Market Moves:
  • S&P 500: +0.5%
  • Dow: +0.1%
  • NASDAQ: +1%
• Headlines:
  • Alaska Airlines drops 6% on cost warnings.
  • Tesla up 5% after Musk’s $1B stock buy.
  • Oracle up 3%—speculated as TikTok acquirer, amid new US-China deal framework.
  • "Absolutely extraordinary what's going on right now and how Oracle seems to be in the mix for so many things..." (Ann, 19:44)

5. TikTok’s US Future & Closing Thoughts

[19:44–21:29]

• TikTok Sale Deadline Looms:

  • US/China framework deal reportedly struck ahead of Wednesday’s sale-or-ban deadline.
  • President Trump and President Xi to meet Friday to finalize terms.
  • Guest reference: Kevin O’Leary (Mr. Wonderful) remains a vocal would-be buyer.

• Wider Implications:

  • Outcome could ripple across social media stocks (Meta, Snap, etc.).

Notable Quotes & Memorable Moments

• “There’s 1400 employees at OpenDoor. I don’t know what most of them do. We don’t need more than 200.”
  — Keith Rabois, via CNBC, quoted by Ann (02:13)

• "I’m excited to break this down with you, because I’m slightly confused as to this valuation."
  — Ann (07:01)

• "He created StubHub 25 years ago… to bring liquidity, transparency, and trust to the category."
  — John (05:19)

• “…all outstanding shares of our Class B common stock will be held by our founder and CEO Eric Baker… he will have the ability to control the outcome of any act[ion] requiring the general approval of our stockholders…”
  — StubHub IPO filing, quoted by Ann (13:20)

Timestamps of Key Segments

• 00:02 – Opendoor shakeup, CEO change, board, and stock reaction
• 02:13 – Keith Rabois on layoffs: “We don’t need more than 200 [employees]”
• 04:30 – StubHub IPO story begins
• 05:19 – StubHub’s foundation and founder’s journey
• 07:01 – Ann questions valuation
• 10:05 – StubHub’s competition (Ticketmaster, Live Nation, Vivid Seats)
• 12:16 – Secondary market regulation, fee transparency, and artist pushback
• 13:20 – Founder control and dual-class shares cited from IPO filing
• 14:43 – Ann’s skepticism on high IPO multiples
• 15:56 – Listener question on dual-class shares
• 16:10 – Ann's explainer on dual-class shares (Alphabet/Google example)
• 18:56 – Closing market rundown
• 19:44 – TikTok sale updates and broader market implications

Takeaways

• Opendoor’s overhaul is dramatic, but Wall Street remains unconvinced until new strategies are explained.
• StubHub’s IPO is heavily oversubscribed in a hot market, but the financials, competition, and founder control raise big questions.
• Dual-class share structures are central to today’s IPOs, shielding founders even as public investors provide capital—but not necessarily a voice.
• Major tech, entertainment, and geopolitical news (TikTok, Oracle, US/China relations) are moving markets in real time.

Episode in a sentence:
A major shakeup at Opendoor and StubHub’s controversial, founder-controlled IPO highlight a market where investor enthusiasm, company fundamentals, and corporate power structures are all in flux.