Clients of investment banks in an IPO have a choice to invest or pass on the deal. There are many things they consider when making this decision, and the price of the deal is one of those. Assuming they are not given inaccurate information, they are not getting "bilked" by the banks if the stock goes down in the aftermarket. The clients know this is a possibility, and they chose to invest at $38 per share. Right now those shares are worth less than the offer price, which is disappointing to the clients, but they made the decision to invest at $38 per share.
I think what cletus is getting at is that the orchestrated IPO pop has become SOP for tech IPOs, and it's nice to see it fallible for a variety of reasons:
0. Keeps people guessing.
1. The company got most of its IPO market value, instead of having a portion extracted by Wall St. insiders.
2. The 'bubble' got popped early, which is probably a good thing for most everyone but Wall Street insiders.
3. Wall Street's ability to orchestrate asset bubbles, whether coordinated or purely emergent, and profit off them at the expense of potential crashes and financial crisies later, just took a hit.
4. There's less or no irrational exuberance this time around. The market may actually have learned from the 2000 and 2007/8 crashes.
