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There doesn't seem to be a lockup period, and the conversion seems incompetently delayed. There's no reason given why it should not have been possible for them

There doesn't seem to be a lockup period, and the conversion seems incompetently delayed. There's no reason given why it should not have been possible for them to dump shares if they wanted.

throwaway5752 5y ago
When I read "Missed their big payday" I assume they've been screwed out of their shares via convertible shares or liquidation preferences. They didn't get to sell the top on the post-SPAC debut. Their Bs are being converted to As, but it's not as fast as they want. They are missing their maximal payday (assuming BZFD shares don't recover) but there is nothing here about them not getting their shares and being about to sell.
- PhineasRex 5y ago
  The strike price is now higher than the sale price for most employees and former employees so practically they cannot sell.
  - ckdarby 5y ago
    Uh, could you not harvest the capital loss against gains elsewhere?
    - bagels 5y ago
      I think their point is that they should have a loss in the first place.
    - sokoloff 5y ago
      If you have options with a strike of $8 and a market price of $6, you could exercise your option at $8, sell at $6, and bank a capital loss to use against gains elsewhere. Or, wildly better, you could hold the options unexercised, and use that $2 per share for whatever you want, including paying capital gains taxes on other gains. Burning up options on 100 shares to generate $200 in losses (and actually losing $200 of cash in the process!) to offset gains that will result in $30-60 worth of tax liability makes no sense.
  - deleted 5y ago
    [deleted]
0x0nyandesu 5y ago
It honestly comes off as short sighted from the equity holder perspective. FB also dropped on it's first trading day but look at it now. Most of these people would be better off hodling for a few years.
- tehwebguy 5y ago
  Very possibly saved them in fact, not likely they would have sold at the exact moment it peaked
- ipaddr 5y ago
  Buzzfeed is not facebook and expecting a rebound is like waiting for a blockbuster revival.
  - 0x0nyandesu 5y ago
    These employee shareholders are all whales for this given stock so if they all sell at once not one of them would get the same price. They'd all tank it for each other. They are far better off waiting for a random Tuesday 2 years from now so that the market can absorb it. As far as buzzfeed not being Facebook so what? Stocks these days are more marketing than anything else.
- tibbetts 5y ago
  I haven’t done the research, but Facebook is generally exceptional. I would expect that on average shareholders of companies that drop on IPO would be better off selling at the open and diversifying than holding for any period of time. I’m even more confident this is true of SPACs.
ClumsyPilot 5y ago
Now, a hypothesis, what if it was delayed on purpose to enable class A holders to offload their shares fir more gain? What if they feighned incompetence? It would not be the furst time employees loose to corporate shenanigans

There doesn't seem to be a lockup period, and the conversion seems incompetently delayed. There's no reason given why it should not have been possible for them to dump shares if they wanted.

throwaway5752 5y ago

When I read "Missed their big payday" I assume they've been screwed out of their shares via convertible shares or liquidation preferences. They didn't get to sell the top on the post-SPAC debut. Their Bs are being converted to As, but it's not as fast as they want. They are missing their maximal payday (assuming BZFD shares don't recover) but there is nothing here about them not getting their shares and being about to sell.

PhineasRex 5y ago
The strike price is now higher than the sale price for most employees and former employees so practically they cannot sell.
- ckdarby 5y ago
  Uh, could you not harvest the capital loss against gains elsewhere?
  - bagels 5y ago
    I think their point is that they should have a loss in the first place.
  - sokoloff 5y ago
    If you have options with a strike of $8 and a market price of $6, you could exercise your option at $8, sell at $6, and bank a capital loss to use against gains elsewhere. Or, wildly better, you could hold the options unexercised, and use that $2 per share for whatever you want, including paying capital gains taxes on other gains. Burning up options on 100 shares to generate $200 in losses (and actually losing $200 of cash in the process!) to offset gains that will result in $30-60 worth of tax liability makes no sense.
- deleted 5y ago
  [deleted]

0x0nyandesu 5y ago

It honestly comes off as short sighted from the equity holder perspective. FB also dropped on it's first trading day but look at it now. Most of these people would be better off hodling for a few years.

tehwebguy 5y ago
Very possibly saved them in fact, not likely they would have sold at the exact moment it peaked
ipaddr 5y ago
Buzzfeed is not facebook and expecting a rebound is like waiting for a blockbuster revival.
- 0x0nyandesu 5y ago
  These employee shareholders are all whales for this given stock so if they all sell at once not one of them would get the same price. They'd all tank it for each other. They are far better off waiting for a random Tuesday 2 years from now so that the market can absorb it. As far as buzzfeed not being Facebook so what? Stocks these days are more marketing than anything else.
tibbetts 5y ago
I haven’t done the research, but Facebook is generally exceptional. I would expect that on average shareholders of companies that drop on IPO would be better off selling at the open and diversifying than holding for any period of time. I’m even more confident this is true of SPACs.

ClumsyPilot 5y ago

Now, a hypothesis, what if it was delayed on purpose to enable class A holders to offload their shares fir more gain? What if they feighned incompetence? It would not be the furst time employees loose to corporate shenanigans