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After summarizing the business model, the current situation and the key players, we will try to
address the following questions in the case discussion:
1. What are the advantages and disadvantages for Rosetta Stone of going public? How
much money does the company need and how much does it raise? Are there any
alternative financing sources?
2. What is the money used for? Go to the SEC webpage and check out Rosetta’s S1
filing for additional information about this and the following questions.
3. Is the amount of shares sold rather high or low? How many secondary and primary
shares are being sold? Is there a greenshoe option?
4. Do you think that the moment of the introduction has been chosen wisely? Is the
company prepared?
7. What would be an appropriate market price? Please justify your answer with a simple
DCF approach and a valuation using multiples.
8. At what price do you think should Rosetta stone be sold during the IPO?