Peter Thiel, the famed venture capitalist and Facebook’s (FB) earliest investor has sold the majority of his hodlings in the social network, after restrictions on insider selling of the stock ended last week.
According to a filing with the U.S. Securities and Exchange Commission, Thiel, who in 2004 invested $500K to become Facebook’s first outside investor, sold roughly 20 million Facebook shares in 25 transactions on Thursday and Friday at prices ranging from $19.69 to $20.70 per share.
At an average price of $19.73, the value of the sales, which reduced Thiel’s FB holdings by some 72%, comes to about $400 million – an impressive return even if he did sell at nearly half of Facebook’s May IPO price of $38 a share.
Thiel, a backer of numerous early-stage tech companies, has raked in more than $1 billion out of Facebook this year alone. He already sold 16.8 million shares in the IPO, for proceeds of $638 million.
The SEC filing said Thiel’s sale was planned prior to the IPO date and was known at that time, suggesting the share-dump wasn’t in response to the stock’s drop. The reality however, is that Thiel’s stock sales represent a near-exit for him, since he has now dumped almost all of his Facebook holdings.
Thiel’s move, who is on Facebook’s board and still owns about 5.6 million shares, worth $112 million at Monday’s $20.01 closing price, comes as Menlo Park-based Facebook’s stock continues to plummet. Once viewed as the most valuable tech company to ever hit Wall Street, Facebook, whose hugely hyped and highly anticipated IPO had valued the company at more than $100 billion, is now valued at $42.8 billion, just over half what it was three months ago. Facebook’s shares closed recently at $18.75, a far cry from its IPO price of $45 a share.
“Inside Facebook’s headquarters, a red-and-white poster affixed to a wall asks bluntly: “What Could Go Wrong?” Somini Sengupta, of The New York Times, reports that below, in black ink, someone has scrawled in tiny letters: “Everything.”
Facebook’s steady descent has prompted calls for CEO Mark Zuckerberg to step down and let a more experienced executive run the world’s number one social network.
“There is a growing sense that Mark Zuckerberg, talented though he may be, is in over his hoodies as CEO of a multibillion-dollar public company,” Sam Hamadeh, head of research firm PrivCo, told the LA Times. “While in many cases a company founder can, and does, grow into the job, things are happening so quickly that there is precious little time here for Zuckerberg to do that.”
Facebook went public May 17 and briefly rose to $45 before nosediving beneath $20 a share in recent weeks.
FB’s pps range since IPO: $18.75 – $45.00.