If you’ve never been to a Century 21 store, you’re missing an experience. I picked up an Armani suit there on the cheap (leftover, damaged, some-damn-thing), not to mention a Ted Baker shirt for around $50. It’s where you go in Manhattan for discounts. Where do you go in Silicon Valley? Apparently, Facebook.
As I mentioned yesterday, Facebook has put together a deal to allow employees to cash out of some of their pre-IPO shares. It’s generous, and from a business perspective, it makes sense. The only problem is that it has called Facebook’s claimed (and probably bullshit) valuation into question. They are allowing employees to sell shares based on a $15 billion valuation, which is based on the last equity investment made in the company.
Today, ValleyWag has reported that many Facebook employees agree with my assessment of the company’s valuation. Plenty of employees are trying to dump their holdings, several at a third of the company’s “perceived” value. Some could look at this cynically, perhaps as a lack of faith in Facebook. I get this. A year ago, we were talking about the invulnerability of MySpace, and now, the war appears to be long won.
But, I don’t think anything that jaded is at play.
Instead, I think employees want to take advantage of an opportunity to cash out, which is unsurprising when you figure that these guys probably have a shitload of compensation tied up in their equity holdings. And, I think they are being realistic about the value of the company. $15 billion is absurd; $5 billion is a thrid less absurd.
Again, I can’t shake my CMGi visions when I read this shit. It’s all coming back. At least I’ll have something to cover for a while.