Ask HN: re: secondary markets for startup stock..

8 points

16 years ago

I've been reading about secondary markets for non-public stock [1], that is, buying and selling stock in companies that haven't IPO'd yet. From what I understand, they can be freely sold as long as the people making purchases are accredited investors. Is that right?

I read that early Facebook employees have been able to cash out by selling some shares on secondary markets.[2] I've also read about people selling Zynga shares on the secondary market. [3] I also know that SecondMarket.com [4] is trying to capitalize on this.

What are avenues for founders and early employees to sell stock in a secondary market? Anyone hear of companies other than Facebook and Zynga selling stock on secondary markets? What other stipulations are there about selling shares in a private company?

_update_ I also just found a secondary market at sharespost [5]

[1] http://www.ericjohnolson.com/blog/2009/04/23/secondary-markets-for-private-company-stock-whats-happening-and-what-are-the-issues/

[2] http://www.businessweek.com/magazine/content/08_33/b4096000952343.htm

[3] http://www.secondshares.com/2010/04/06/zynga-5-billion-valuation-buy-–-early-leader-in-social-gaming-is-printing-money/

[4] http://www.secondmarket.com/

[5] http://www.sharespost.com/