The S-1 disclosures that tech companies file with the SEC before a stock listing have grown in entertainment in recent years. At barely 250 pages, the prospectus for Palantir Technologies is almost unputdownable.
The comedy memes first established by Uber and WeWork all recur: the disregard for old-fashioned notions of return – “we may never achieve or maintain profitability” – and the embrace of non-GAAP accounting BS, including the infamous contribution margin.
This suggests that investors should look at the cost of a companies’ revenue as just marketing and customer acquisition, while ignoring those other pesky running expenses, such as paying employees.
Palantir’s, presumably, don’t come cheap. Chief executive and founder Alexander Karp says: “Our company is a creative enterprise, filled with strong personalities who are immensely talented.”
Maybe that’s why revenues still don’t exceed expenses 17 years on from its founding.
Palantir was established in 2003, with seed funding from the CIA, in the belief that US intelligence agencies had all the data to spot the build-up to the 9/11 terrorist attacks, but couldn’t link it together.
[Silicon Valley may know more than most about building software] but they do not know more about how society should be organized or what justice requires
Palantir’s biggest group of customers are US government intelligence and defence agencies, and those of some US allies.
Karp