Andreessen Horowitz dumps a third of its Facebook shares

Andreessen Horowitz dumps a third of its Facebook shares

Summary: Last year, a16z said it was investing for the long-term. This year, it is selling off a large portion of its shares.

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According to regulatory filings to the US Securities and Exchange Commission, US investment firm Andreessen Horowitz has disposed of about 2.3 million of its shares valued between of US$49.22 and US$50.07 each. It now has about 4.6 million shares remaining.

In November 2012, a16z's faith in the social network was brought into question when the investment firm's co-founder Marc Andreessen sold his personal stake in Facebook. Andreessen himself is on Facebook's board of directors, and it was through this role that he gained the shares he sold last year. At the time, a16z told TechCrunch that the sale of shares was simply to cover tax liability and that the investment firm believed in the long-term value of the company.

Angel investor Peter Thiel also sold off 20 million of his shares in the company shortly after the mandatory lock-up period that followed Facebook's initial public offering in May 2012. At the time, the shares were valued between US$19.27 and US$20.69 each, lower than when the company listed at US$38 per share.

Facebook is not the only thing Thiel and Andreessen have in common. Thiel previously debated with Andreessen over the success of Twitter, claiming that Twitter will outlast The New York Times.

Thiel's confidence in Twitter and apparent loss of such in Facebook appears to match up to the success of each company at its IPO. Facebook had a number of factors that led to an almost immediate slide in its post-IPO share value, however, Twitter saw its share price climb from its initial post-IPO pricing of US$26 per share to US$45 by the end of its first day on the New York Stock Exchange.

Today, Twitter shares are still normalising around US$41. Facebook sits about the US$47 mark.

Topic: Social Enterprise

Michael Lee

About Michael Lee

A Sydney, Australia-based journalist, Michael Lee covers a gamut of news in the technology space including information security, state Government initiatives, and local startups.

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3 comments
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  • They should have dumped all their Facebook shares

    Facebook's earlier announcement that teenagers are using the service less is a bad omen. There seems to be a migration of young people to messaging services.

    The other bad omen for Facebook is that rival Google controls the main computer platform of the future, Android. If you control the platform then you can control the services on that platform.
    Vbitrate
    • The numbers indicate otherwise.

      Facebook profits doubled last quarter to US$621 million compared to Twitter's profits of, uh..NEGATVE $US 134 million this year. As for the teens, remember this golden oldies, http://www.forbes.com/sites/larissafaw/2013/01/09/is-apples-iphone-no-longer-cool-to-teens/? Then a few months later it was http://www.slashgear.com/survey-shows-62-of-teens-want-to-buy-the-iphone-10277238/.

      I won't even touch the idea that no one "controls" an open source platform. Or the idea that Google makes far more money from iOS users than Android.

      Maybe you should just quit while you're behind.
      matthew_maurice
  • It's hardly "dumping" when you're selling at a high.

    Andreessen Horowitz is selling 1/3 of its Facebook holding at a peak. Which for the financially-challenged is called "taking a profit." They're getting a $US 113-115 million payday, while still maintaining 2/3 of their original stake. Oh, and let's not forget that the original investment was just US$80 million.

    So, just to recap, Andreessen Horowitz is getting a 30% ROI while still owning 4.6 million shares with a current valuation of US$230 million. Facebook shares could lose half their value and Andreessen Horowitz would still be up a couple of hundred million. Let's see what Twitter is doing after a few earnings reports.
    matthew_maurice