Alex Karp, CEO of Palantir Technologies, harshly criticized Wall Street on Tuesday, saying there was too much emphasis on short-term gains at the expense of developing healthy, long-lived businesses.
Karp made the comments in an interview with CNBC’s Wilfred Frost at an event organized by the Executives’ Club of Chicago. The remarks were later aired on CNBC’s “Closing Bell”.
“We told Wall Streeters that we will focus on building the long-term health of our business, that we will invest in our product development and in our customers, and that you only have to measure yourself against them,” said Karp, also a Palantir -Co-founder. The developer of data analysis software went public in September after almost two decades as a private company via a direct listing on the stock exchange.
Not everyone on Wall Street has such a short-term focus, Karp admitted. Still, he said it remains “one of the most destructive, corrosive properties of an otherwise interesting and largely functioning system.”
Investors have not shied away from Palantir’s stocks since they debuted on the New York Stock Exchange. Palantir’s shares closed at $ 25.6 on Tuesday, up nearly 170% since closing their first session at $ 9.50 on September 30, but fell 4.4% on the day.
Palantir’s stock hit an all-time high of $ 45 per share on Jan. 27, coinciding with the trading frenzy created by Reddit traders on heavy bets against companies like GameStop. In late January, CNBC’s Jim Cramer found that some individual investors were apparently stacking their way into “really beloved” stocks like Palantir.
Palantir continued to generate interest in Reddit’s WallStreetBets in the weeks that followed.
Karp said he wasn’t too concerned about the company’s online hype and said, “I have a lot of other concerns that bothers me a lot more.”
“I like so-called retail investors for many reasons,” added Karp, explaining that the company’s decision to go public instead of a traditional IPO was made in part to improve the playing field between individuals and institutions. “I take great pride in the fact that ordinary people, who invest their own money at their own risk, form their own opinions and make a lot of money,” he said.
However, Palantir’s focus is the same no matter who its shareholders are, Karp emphasized.
“We’re in for the long run. If you are speculating or thinking about it in the short term, there are a lot of other things to invest in,” he said. “If you want something different, it’s a huge world. Buy another stock. You don’t have to buy Palantir. Nobody is forcing you.”