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.
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.
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.
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?
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.
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.