Everyone is trying to get pre-IPO Facebook shares any way they can. Some investors purchase shares on secondary markets like SecondMarket and SharesPost. Others broker private sales. Today, GSV Capital, a publicly traded investment management company, announced that it has purchased a small number of shares (225,000) at a price ($29.28) which would give Facebook an implied $70 billion valuation.
Although GSV Capital doesn’t say, this most likely was a private sale. (Update: The company confirms the sale was through a “private secondary transaction”). Facebook passed $70 billion on the secondary markets in January, and hit $85 billion in March.
It’s such a small number of shares and a single trade, so you can’t make any generalizations about the implied market valuation of Facebook. What’s more interesting is what the trade did for GSV’s stock. It is trading up 21 percent this morning at $12.45. GSV’s stock is thinly traded, but it just became a way for public investors to get some exposure to Facebook. The Facebook shares now represent 15 percent of GSV’s portfolio. (It also made a direct $2.25 million investment in Kno earlier this month).
Facebook is the world’s largest social network, with over 1 billion monthly active users. Facebook was founded by Mark Zuckerberg in February 2004, initially as an exclusive network for Harvard students. It was a huge hit: in 2 weeks, half of the schools in the Boston area began demanding a Facebook network. Zuckerberg immediately recruited his friends Dustin Moskovitz, Chris Hughes, and Eduardo Saverin to help build Facebook, and within four months, Facebook added 30 more college networks. The original...
225,000 shares in social-networking company Facebook at an average price of $29.28 per share. The investment of $6,587,500 represents approximately 15% of GSV’s total portfolio.
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