August 16th For Facebook Insiders: Happy Facebook Unlock Up Day

Today is the day where insiders of Facebook (FB) which acquired shares prior to the IPO can start selling them.

Typically shares received of a private company are restricted from being sold until 6 months after the company goes public.

Usually these shares are held by true insiders of a company; their officers, directors and shareholders but in the case of Facebook there was a lot of VC money, angel investors and due to sites like SecondMarket.com which we talked about a couple of years ago, a lot of ordinary investors who acquired shares prior to the company going public.

While those who bought Facebook.com at the IPO of $38 are down some 40%, many of these people even those who bought shares through SecondMarket paid on a few bucks for their shares

Back in October 2010 Facebook split their shares 5:1.

In 2009 shares were trading in the 20′s, Earlier in 2010 shares were trading in the $30′s meaning anyone who bought shares at $20 or $30 paid something around $5-$6 per share and at $20 a share would more than triple there money by selling here.  The last private reported sales of Facebook stock prior to the split were at $75, meaning those investor still could sell today (at yesterday’s clost) and make 25% on their investment.

On the other hand in the months leading up to the IPO shares were trading privately in the mid to high 30′s.

So today is unlock day, all those investors, plus true insiders can trade their shares for the 1st time.

Should be an interesting few days.

 

 

Comments

  1. Charley says

    I got this error browsing through Google Chrome

    >>> This is probably not the site you are looking for!

    You attempted to reach secondmarket.com, but instead you actually reached a server identifying itself as http://www.secondmarket.com. This may be caused by a misconfiguration on the server or by something more serious. An attacker on your network could be trying to get you to visit a fake (and potentially harmful) version of secondmarket.com.

    You should not proceed, especially if you have never seen this warning before for this site. <<<

  2. Grim says

    Might actually be a good time to buy, seeing that it’s gone below $20 a few times this morning, due to the lockup. But I’m still sceptical. A lot of shares are going to flood the market. With Groupon and Zynga dipping far below what anyone might have expected, “social” seems to be pretty unpredictable at this point, so who knows how low FB could go as well.

  3. BillW says

    @Grim….best to wait IMO. There is a “second” lock-up coming in another month or two when a much larger group, including facebook employees can sell their stock. That one could make a bigger impact that today.

    Also, the decison as to whether the Bush tax cuts get extended might have an impact on people to sell or not sell stocks depending on capital gains by year end.

  4. BrianWick says

    The first day of trading all kinds of manipulation went on to keep the stock from dipping below its $38 IPO price.

    Same thing going on today with big blocks being dumped in order to cover tax obligations ?

    Sadly comical how many suckers with their vibrators (oops I mean iPhones) has been sold a bill-of-goods.

    I think the real value and trading range is $12-$15 until the company redefines itself (if at all).

  5. says

    Hello MHB,

    FaceBook.com is a morally and fundamentally flawed experiment going south. Underneath this downwind there are many serious unpublicized problems. Linkedin is a much better economic Model that will benefit the most from FBs demise. Google plus and others are widely smiling and will continue to eat FBs lunch.

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  6. BillW says

    @ Brian Wick- re: your quote “Sadly comical how many suckers with their vibrators (oops I mean iPhones) has been sold a bill-of-goods.”

    You thinkin’ Apple is going to tank?? If so pls tell us why.

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