Are sales of private company shares taking a breather? Demand for private company shares resulted in $115.4 million worth of transactions on SecondMarket during the first quarter of 2011, down from $120 million last year. The value of shares trading hands was also down from $158 million in the fourth quarter of 2010, according to its first quarter report. Update: SecondMarket revised its first quarter numbers to $156 million to account for trades that weer executed but did not clear until January.
The biggest buyers were high net-worth individuals, who accounted for 59 percent of completed transactions, compared to only 18 percent last quarter. VC funds stopped buying completely during the quarter, whereas the quarter before they made up a whopping 43 percent of completed transactions (with mutual funds making up another 13 percent).
The most coveted private stock remains Facebook, which saw its valuation reach $75 billion on SecondMarket (and $85 billion on SharesPost). Facebook was the most “watched” company, followed by Twitter, Groupon, LinkedIn, Zynga, Foursquare, Skype, Pandora, Yelp, and Gilt Groupe—in that order.
In March, SecondMarket launched a redesign which allowed members to more easily “watch” companies, which is similar to following news about those companies. Foursquare was the fastest rising star, with 2,950 percent growth in the number of participants “watching” the company. All of this interest propelled Foursquare to the No. 6 spot on the overall most-watched list. Other rising stars include Dropbox, Spotify, Skype and Gilt. Newcomers to the watch lists included Hulu, LivingSocial, Quora, and Square.