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February 21, 2007

The buzz about Clearwire's IPO

Posted by Tricia Duryee at 11:49 AM

Kirkland-based Clearwire, Craig McCaw's latest wireless venture, is getting ready to go public and attempting to raise up to $575 million.

And, if successful, Clearwire's IPO will be the second largest in Washington history after AT&T Wireless raised $10.6 billion in 2000.

With so much money on the line, the company is gathering quite a bit of buzz.

Clearwire is rolling out a nationwide wireless broadband network called WiMax that for now can replace DSL or cable in the home, but will be increasingly mobile in the future, potentially creating a whole host of new applications.

But recently, it seems every time I write about Clearwire, as I did today, I get a number of emails or phone calls asking about the IPO.

Partly, I think this is because the company was featured on Cramer's "Mad Money" TV show, last week. The show features Cramer, an enthusiastic man who picks stock that can send prices soaring.

And, according to TheStreet's recap of the show last week, he likes McCaw a lot, calling him one of "the greatest moneymakers" in telecom history.

It is true that McCaw has an incredible track record, responsible for what later became AT&T Wireless and Nextel Communications. But he also dabbled in ventures that flopped, such as XO Communications, which went bankrupt, and Teledesic, which sputtered before it had a chance of beaming Internet access from the sky.

Cramer acknowledged these ventures, saying: that even one of his biggest failures could have made people a fortune if they had been careful about profit-taking.

This background leads me to answer two of the biggest questions I've been getting from readers: When will the IPO happen? And, how can I participate in it?

First off, no one knows for sure when it will happen. Bellevue-based Sharebuilder, which allows individuals to buy stocks directly, is estimating that the stock will be priced during the week of March 3.

Secondly, it is really difficult to participate in IPOs as an individual.

"IPO investing is largely the province of large institutional investors; individuals are at a distinct disadvantage," according to IPOHome.com. Large institutional investors that have close relationships with the brokerage houses typically get first crack at buying shares. IPOHome.com does share a few techniques for how an individual could invest.

Good luck everyone.

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Tricia Duryee
Tricia Duryee
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