Secondary Markets

SecondMarket CEO Announces Layoffs: ‘I Admit It, I Screwed Up’

Mr. Silbert. (Photo: http://www.flickr.com/photos/docsearls)

SecondMarket was having a pretty good week. On Tuesday came a flurry of articles about the startup’s crowdfunding-flavored partnership with Angellist, and just yesterday, CEO Barry Silbert announced that Tennessee’s First Advantage Bank was using the service to go private while remaining open to investors. He called the move “validation of our model.”

Today, according to a post on SecondMarket’s blog, several employees got the ax as part of “org changes.” Read More

higher learning

After Facebook, SecondMarket Seeks to Educate Investors on the Next Big Things

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So you never managed to get your hands on any Facebook shares ahead of the social media giant’s IPO, and given some of the prices paid in the secondary markets, maybe that’s not such a bad thing.

You’re fascinated by the rapid advances in health care IT, maybe, intrigued by the notion that thousands of startups will be taking advantage of mobile, or big data, to disrupt the incumbent players—incumbents with deep pockets to buy up the most promising entries.

Ah, but where to start. You’re not a venture capitalist, you’re just an accredited investor looking for the kinds of outsized returns that stocks and bonds aren’t getting. Read More

Secondary Markets

The Future of SecondMarket In a World Without Private Facebook Shares

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In SecondMarket’s 2011 year-end report, Facebook beat out Twitter, Foursquare, Gilt Groupe, Hulu, Spotify, and more as the trading platform’s number one most-watched company. Facebook has 14,973 “watchers,” almost double the next-closest, Twitter at 7,854. More tellingly, according to public statements from CEO Barry Silbert, 30 percent of SecondMarket’s revenue came from trading private shares of Facebook stock, which will soon become a province of the public markets.

But to hear Mr. Silbert tell it, he’s coping with the loss just fine. After all, it’s not like they didn’t know this was coming. As Crain’s reports, on Wednesday, Mr. Silbert told the audience at an Xconomy forum on New York’s venture capital scene, “We’re completely prepared to fill the hole,” adding, “We’re hiring, and we have a lot of capital.” Read More

Fresh Capital

Smooth Sailing for SponsorHub: Emerges From Hiding With All-Star Seed Investors and $750K

betabeat party dens

SponsorHub—a marketplace for brands looking to sponsor quality events—closed a $750,000 round of funding late in the summer, when it was about three months old and six employees strong. The startup announced the news today, along with a lineup of industry veterans, entrepreneurs and venture capital firms. CEO Robert Johnston used to coordinate events when he worked at Apple and had some experience producing events in other capacities. “I kept hearing from the big brands was that it was really hard for them to find great events to sponsor,” Mr. Johnston said.  Read More

Secondary Markets

SecondMarket’s Still Doing Robust Bankrupcty Business

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SecondMarket is most popularly known as a private company equity exchange and indeed, the startup’s fastest-growing business consists of private company stock sales. That would be the Facebook and Twitter and other pre-IPO share shuffling that happens before a company goes public. And of course, a lot of demand is in tech (although PIMCO has traded on SecondMarket before, as has SecondMarket).

But a report out this month reminds us that one of SecondMarket’s most important and perhaps unexpected services involves transactions related to bankruptcy. SecondMarket compiles data about bankruptcy asset transactions and calculated that bankruptcy claims slowed in October.

The company doesn’t say how much revenue comes from bankruptcy claims, but it says the bulk of its revenue comes from fixed income securities such as debt instruments and asset-backed securities. Bloomberg reported that SecondMarket did $400 million in private company shares in 2010 and is on track to do $1 billion. Read More

Secondary Markets

SecondMarket’s Barry Silbert Thinks That NASDAQ and the NYSE Are Broken

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On his blog New York Summer, HackNY fellow Akarshan Kumar has been thoughtfully posting about all the tech luminaries that come to influence young minds towards the start-up life and away from Wall Street. The latest lecture notes come from SecondMarket founder Barry Silbert, a former banker himself.

Using examples like the decreasing rate of IPOs over the past decade, the flash crash last May, the impact of high-frequency traders, and the decreasing average holding period of stock (down to just 2.8 months), Mr. Kumar says, “Silbert claimed that the public markets are broken, probably even beyond repair, and that the future lies in private markets.” Read More

Secondary Markets

Wall Street Investment Firm Sues SecondMarket Over $2.4 Million in Facebook Shares

SecondMarket founder Barry Silbert

New York City-based Felix Investments is suing SecondMarket in the New York Supreme Court over a $2,475,000 deal for Facebook shares that never came to fruition. Felix began investing in Facebook back in 2009 through two funds named Facie Libre 1 and Facie Libre II–meaning face book in Latin–and did a brisk business with SecondMarket. Dealbook’s Evelyn Rusli recently described Felix investors as “not part of Silicon Valley’s elite” and “more comfortable navigating the narrow streets of Lower Manhattan than on tree-lined Sand Hill Road in Menlo Park.” The suit is over a deal in January 2010 to buy 75,000 shares from Karl Voskuil, a Facebook software engineer, at $33 per share. Read More

Secondary Markets

Bubble Anxiety at Facebook Is a Boon For SecondMarket

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If there’s one tech scenester not worried about Mark Zuckerberg taking his sweet time to IPO, it’s probably New York’s Barry Silbert. That’s because dotcom bubble déjà vu at the Palo Alto headquarters tends to translate into more business for SecondMarket, Silbert’s online exchange for shares in private companies.

Last year, Facebook shares from early employees (before Zuck limited equity to restricted stock that can only be sold after the company goes public) accounted for nearly 45 percent of all trades on SecondMarket. Today, the New York Times reports, about 100 early employees have left the company, in many cases opting to cash out while valuations are still stratosherpic. “If you’ve seen the world blow up once, you just don’t know what’s going to happen a year from now,” an anonymous former Facebook employee told the Times. Read More