How long after investing in the IPO stage of a successful start up, should you start gaining dividends?

Question by 4.28.2011: How long after investing in the IPO stage of a successful start up, should you start gaining dividends?

How long after investing in the IPO stage of a successful start up, should you start gaining dividends?




Best answer:

Answer by Pierre O
It really depends. Some companies have gone years without paying dividends as they reinvested all the earnings to grow. Intel and Microsoft are good examples of this.
There is a theory that says that dividends are not the most efficient way to distribute income to shareholders as they are effectively taxed twice (once as earnings and once as dividends) so if a company has good investments with high returns, it should do that rather than pay dividends.

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