That number doesn't make any sense. Facebook only sold about 16% of its shares t...

jpdoctor · on May 25, 2012

CORRECTED: Thanks to diego and smackfu below.

Facebook sold X shares for the IPO.

Y shares were created for the sale.

Z shares were sold from the insiders pool.

Obviously: X = Y + Z.

The headline says: Z = 0.57 * X

In old-fashioned days (when companies paid weird things like dividends), it was seen as profoundly bad for employees to dump this much stock during the IPO. Usually, employees who think the stock is about to double because of a revenue/earnings ramp would not be so eager to part with their shares.

smackfu · on May 25, 2012

Here's another source for the number: http://e.businessinsider.com/public/796352

diego · on May 25, 2012

Thanks, that's what I thought: 57% of the stock sold in the IPO came from insiders. That's very different from what the submission title says.

michaelcampbell · on May 28, 2012

It says "sold 57% of THEIR shares"; I don't understand how one could read it any other way.

diego · on May 25, 2012

That's incorrect, see link below.