“Earlier this week, Reddit disclosed in a corporate filing that CEO Steve Hoffman sold 500,000 shares, and Reddit COO Jennifer Wong also disclosed that she sold 514,000 shares.”
If they believed in the platform, they would hold. Yeah looks like they are looking for bag holders.
I think it matters more what percent of their holdings they sell rather than the amount they sell.
The COO holds 1.4 million now, so she dumped 25% of her shares
To be fair (and you can probably see by my username I don’t like reddit anymore), I think it makes perfect sense to dispose of a fair portion of your shares in this situation. Firstly, these asshats get paid part of their salary in shares, it’s natural to want to get more security on part of your income. Secondly, with how hard the price rose in the first couple of days, it makes sense. But people are welcome to disagree, of course.
How does that respond to the original idea, that is:
if they believed in the company, they would hold their stock.
You are not a genius for selling your company’s stock after IPO, you are a grifter. Doesn’t matter how many voting shares they have, doesn’t matter how much more money they need - they do get paid in cash too, and they can borrow against the stock.
So they sold out. Fuck them both for that.
The point would be to diversify assets. You don’t want to gamble everything on the hope the thing you believe in is successful. Not that I think they believe in the platform, but it is probably a smart idea to diversify no matter what. 25% of your shares does seem like a lot though.
If they sold at $50 a share, they pocketed over $25M each. Even after taxes, that is more than enough to live comfortably in any region’s cost of living.
That’s not diversifying. That is greed.
Them not selling isn’t any more greedy. No matter what, they own the value of the stocks, whether they liquidate them or not. It’s fucked up that anyone gets paid that amount in general, but they did and it’s theirs. I don’t know what you people would want from them. Isn’t holding onto the shares hoping the value goes up even more greedy?
They get paid in cash ffs.
You sell stock when you think it’s overvalued.
Or you sell stock when you need to rebalance. Fuck spez, but selling 25% at IPO seems sane and reasonable to me.
if they believed in the company, they would hold their stock.
The COO holds 1.4 million now, so she dumped 25% of her shares
Selling quarter of your stock AT THE FUCKING IPO is a shame. I can’t believe people are defending that.
And I suspect they can’t sell the rest as easily as the A shares.
That’s SOP for tech companies.
I have nothing I’m willing to defend about Reddit management, I love the idea that they will end up penniless one day (though I’m sure that will not happen.)
I just don’t think selling off 25% of one’s shares (necessarily) means what has been suggested.
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No, she held almost 2m, sold 25% and has 1.4m in remaining stock.
I deleted my comment because I realized my mistake.
I don’t know how much of a bag holding exercise it is instead of a “treat yoself” moment. Half a million shares at $50/share is $25 mil, minus 50% taxes is $12.5 mil.
That isn’t that much money in the bay area. Don’t get me wrong. It’s a lot. But that’s just a $4 million house with another $1 million in furnishings, and I’m guessing a nice car or two. Take the other $6 mil and invest in a diverse portfolio. They’ve basically sold their stock so they can square away their personal lives.
Won’t somebody think of the poor shareholders.
When I treat myself, it’s to a takeaway meal that’s like $20. Reddit has “never made a profit”™. Siphoning $16mil out of it on day one is obscene.
In what way do you think they’ve siphoned $16mm out of Reddit?
Awarded themselves shitloads of stock, then sold a quarter of their shares each as soon as humanly possible. That money is not being invested in the company, it’s going straight in these individual’s pockets.
I wasn’t trying to make a “won’t someone think about the shareholders” argument. Thanks for the strawman.
Really the gist of what I was after is “you’d do the same in their position”. $12.5 mil is a lot, but we’re not talking about $12.5mil/year. Its a one time sale. Someone that earns $100,000/yr just saw 125 years of income materialize in a couple seconds. But if you had the same opportunity, you’d probably do the same. If you would instead donate it to charity, please let us know which charities you’d donate to.
Fair enough, you didn’t say you condone it. But your comment does read with much more support than I would offer. And asking me which charities I’d donate to… ha! I don’t see why that’s relevant. Maybe I would do the same, but I don’t already have an $800,000/yr base salary.
More relevant: this windfall would be 250yrs income for me. And on that income I already do donate to charity (albeit probably about 2% of my earnings). If this chump followed my percentage they would be donating 6 whole years worth of my salary on this windfall (plus 1/3 of my salary per year).
The point is “treating yoself” to $12mil after tax is absolutely obscene whatever way you look at it. Not to mention still sitting on 3x more than that.
That’s not how stocks work. Share value doesn’t go to the company unless the company sells shares of itself that it owns. It also doesn’t lose money from share value unless it buys shares. The value of shares goes to the shareholder when sold, and it comes out of the wallet of the buyer.
It’s a show of a lack of faith maybe, but it doesn’t effect the company at all except for the effect on stock value from selling if the company also decides to liquidate shares too.
Share prices don’t only fall if the company liquidated stock. They will also fall from something like a mass sell-off because lower and lower prices will be commanded to sell large volumes of stock.
You know, like the one in the article that talks about the 25% drop in share value.
Yeah, I mentioned selling dropping the price, but the price doesn’t effect the company except for the stocks the company itself sells. Having an extremely high or low stock value doesn’t matter if the company isn’t selling stocks. It’s only an indication that the company is doing well or poorly.
We all knew this was a pump and dump scheme. Spez got his, fuck everyone else.
did he really though? because I’d read a big chunk of that massive 100+ million dollar compensation was shares vested after IPO based on performance.
hopefully it ruins them all.
He sold 500 000 shares for a big fat paycheck. It’s not 100 millions of fictional dollars, but he still made out like a bandit.
I’m not so sure. That is only $25 million or so. Who can live on that?
Yeah, this guy isn’t even going to be able to afford caviar for dinner every night. That’s not living.
$25 million will allow you to, at best, snort cocaine off a hooker’s forearm. Not doing it off her ass is like seeing a partial eclipse.
Me. I can live on that. I would have to change my habits like eating more but that’s something I am willing to change.
Lobster and sushi only on days that end with a Y. It’ll be tough cutting back but he’ll manage.
I bet i could live even off 24 Million, call me crazy
I’d have to live like a hobo tho
I could live comfortably for the rest of my life on 1/25th of that.
Or you could buy a house within a reasonable distance of a major city.
The statement you made should be in response to someone who says they need more money rather than less.
Sure. I’m just pointing out that a million bucks isn’t that much in the grand scheme. A life-changing amount to just get one day, sure. But it’s still basically “own a house” rich. Woopty-do. Every boomer within 10 miles of a major metro with a paid of mortgage is nearly a millionaire just in their primary residence.
I want Elon Musk to buy Reddit. 😈
Elon: “Now that I’ve purchased reddit, we’re going to rename it x.”
Person with an ounce of common sense: "But you already changed twitter’s name to that.
Elon: “Don’t be stupid. I named it X, whereas reddit is going to be x. It’s going to be a totally different brand.”
Next he will rename himself to XxElon MuskxX
Even Elon Musk can’t kill what’s already dead.
Elon could be this guy.
This is evil and wild.
Holy shit that would be hilarious!
This is the way!
If he does buy it he’ll probably rate limit it like Twitter
No, do jira first pls
Whomp whomp
Yikes Shaggy, it was the old amusement park owner all along.
Ellen Pao is long gone, though.
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Well nice to see racism alive and well on Lemmy.
Reddit has a market cap of $7.8 Billion right now.
Truth Social had a market cap of $8.4 Billion.
Nothing’s real 😅😓
Capitalism is literally a pyramid scam.
Why do people keep misrepresenting capitalism as some silly boogie man? This is just as stupid as people claiming socialism is innately bad.
Because most people don’t recognize a fundamental difference between capital “C” capitalism (the economic principal of supply and demand. and “venture capitalism” which is about speculating on a business’ future based on what essentially amounts to a magic 8 ball.
Because people don’t understand what the word means. They just want upvotes for saying capitalism is bad.
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You’re talking me now? How creepy.
Sticks and stones won’t get you a positive score in your own community.
It’s all just rigged gambling. That money won’t benefit the company at all. The investors just sold all their stocks to the hedge funds and retirement funds for them to lose money on, like always. The IPO was just a way to pay off investors and let executives cash in their stocks. I’d love to know what restrictions on selling came with the stocks that were given to regular employees and users/mods. Like are they allowed to sell right away or do they have to hold it for some period of time?
But about as democratic as can be. No one was forced to buy Reddit. Benefit or not to the company, the company was essentially sold. The new owners of their very own choice will want a return. A big return to essentially cover 8 billion they just paid for it.
Reddit will need tens of billions in revenue to make the profits those new owners will demand. It is that drive to justify the cost that will make it another shitty bloated ad platform.
But that’s not really how the stock market works anymore. Now investors don’t buy stock to support a company and draw a portion of the profits. That version of the market hasn’t existed for a while.
Now, the market is used as a gambling platform for wealthy people and is kept afloat only by IRA, 401k, charitable trusts, etc. Basically, a company is having trouble with profit. You buy into the company, put in a CEO you can control, have them boost the price at the expense of employees, customers, and long-term profit. Sell the stock. Let the company fall apart.
Then buy it low, have the CEO make up a new product based on whatever tech fad is popular. Sell just before the money is spent. Let the project fail because all the money was spent on marketing and consultants and not on the employees to actually do the project. Buy up the stock again, do some stock buybacks, sell again, etc.
But it’s never a strategy of: hire really good employees, make them happy, give them an achievable project with enough funding, increase the company’s reputation by making quality products, etc. That requires actually good business plans and products and a lot of work and no short term, “hey look at how much money I saved by cutting budgets even though everyone said our products will be crap without it,” kinds of flashy quarterly reports.
Playing the gambling game is more reliable profit and with retirement funds and all that keeping serious market crashes from happening, and the politicians being on their side and willing to bail them out if it does get bad, there’s a lot of wiggle room and a lot of people to lose money and funnel to them that doesn’t affect the corporations.
Influencing Spez’s options on steel tarrifs isn’t worth as much as the founder of Truth Social
This is the first I’ve heard of whatever truth social is
It’s where all the Maga people went after Twitter started banning them for pushing (I think it was russian) propoganda.
It has 1/100th of the users of Reddit and it’s just a Twitter clone but it’s meme stocking because Trump is on there. Obviously the company isn’t actually worth billions but it’s a fun comparison.
It’s a mastodon clone. They literally tried to rip it off and got their hands slapped.
not only is it a mastodon clone, it’s an out of date, wretchedly insecure mastodon clone. cause, you know, trump gets the BEST people lol… fucking clown show
At least truth social is open source
As open source as Reddit? Meaning, original software was but is it currently?
It’s built on mastodon. They got slapped for not linking their source. Not sure if that ever got resolved.
It’s still at 50 dollars which is insane. Even 37 dollars is much more than it’s worth now, and future looks very bleak for it.
Probably depends on the deal they made for selling our data. Could be a gold mine for em. Here’s hoping for a big crash down to earth though.
They sold it to Google for 60 million. That’s a hilariously low price.
Oh noooo, who would have guessed the initial week would have been pumped to grift more value out of it and then immediately hard dumped
Why were insiders allowed to sell so quickly?
There’s a lot of confused people in these threads. Steve Huffman sold 500,000 shares as part of the ipo, so they were some of the shares sold immediately before they opened on the market (at the about $30/share price). He still holds 4.1 million shares. Other insiders sold some shares as well. Some shares were created to raise money for the company. Once the ipo actually happens and the price for all those shares is negotiated with the bank assisting and all initial buyers, then it begins trading on the open market. At that point they are in a lockup period, and they can’t sell anything for about 180 days. All of this is in sec filings, where you can see the source of all the shares that were part ot the ipo.
Look I hate Steve Huffman too, I’m here on lemmy after all. But this is a grossly over valued tech stock and there hasn’t been many tech ipos in a while. It’s very not surprising it would start sinking after an initial explosion of buying activity. It’s not dropping from insiders unloading stock right now though. They’re in lockup.
Steve Huffman sold 500,000 shares as part of the ipo, so they were some of the shares sold immediately before they opened on the market (at the about $30/share price).
I suspected as much. I got the invite too, and thought about putting some money in. But I didn’t want to risk the chance of being King Steven’s exit liquidity, even if I could make some money on it, so I passed.
I wouldn’t have wanted to buy anything either. It’s actually slightly more progressive than most ipo’s in that sense though since it offered a chance to buy shares directly, but that’s not really saying much. A true public offering would allow anyone to place orders as a part of the initial sale. Usually just large financial institutions have the chance and then the price is very inflated by the time most retail traders would be allowed to buy. If we really want to help the rampant wealth inequality in the economy too, there should me some mandated equity that goes to employees whose labor built the company so everyone, and not just the board and a few venture capitalists, can profit from the stock sales. Which I guess is a roundabout way of saying workers should own the means of production. It doesn’t make sense to reward only so few for the work and ideas of so many individuals. And I think it’s a huge inefficiency in the economy that is detrimental no matter your view point (unless you’re a billionaire company founder who doesn’t care about the country, economy, or world as a whole I guess).
I believe the employees got taken care of here, at least the ones that worked for them directly and stuck it out. Equity compensation is such a key part of Silicon Valley culture that they probably couldn’t even hire devs straight out of college without offering them some stock.
I agree, tech companies are better than most in providing equity as a part of compensation, even for lower level workers. I wish it were that way across the entire economy though.
I still believe it was a PPI collection scam. The form I was given to fill out to get on the list was 100% hosted on reddit.com
I was indeed confused and didn’t ask that question with any agenda. It makes a lot more sense now. Thanks for clarifying.
Absolutely, and I did not mean to imply you were asking with any agenda, just trying to be helpful. The articles about this are bascially clickbait and implying things that aren’t true in the headlines for more outrage. I think it’s unfortunate because there is so much to be outraged about in the process of ipo’s, how equity in companies is distributed in general, and who profits, and the clickbait distracts from the things we should truly be outraged about with some false controversies.
“Earlier this week, Reddit disclosed in a corporate filing that CEO Steve Hoffman sold 500,000 shares, and Reddit COO Jennifer Wong also disclosed that she sold 514,000 shares.”
Third bullet point. Nuff said.
This is normal and not a big deal at all. Essentially happens with most IPOs.
This is generally how IPOs work out. Same happened with ARM.
Yup. Nothing surprising.
Let me show you this tiny violin 🎻
Now that is a tiny violin.
It’s bigger than the emoji though.
That’s true. Violin science is complicated, man…
Looks like a tiny cello to me
GOD I LOVE THIS.
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thoughts and prayers; go bears.
Hope it keeps plummeting.
