3 ms·
>On the 15th of December in 2000, NVIDIA announced that they would acquire 3dfx Interactive’s assets for $70 million ($121,613,821.14 in 2023) and 1 million sha
by ddeck 4y ago
>On the 15th of December in 2000, NVIDIA announced that they would acquire 3dfx Interactive’s assets for $70 million ($121,613,821.14 in 2023) and 1 million shares of common stock.
Those million shares are worth about $5.7 billion today ($238 stock, 1:24 cumulative split since then).
- nerpderp82 4y agoHeh, I owned 3dfx stock when they folded. I saw 0$ of that transaction.
- djmips 4y agoPretty sneaky huh?
- cowsandmilk 4y agoWhat’s sneaky? The company was going bankrupt and the deal was approved by shareholders. When you go bankrupt or dissolve, creditors get paid before shareholders. That someone owned shares and saw nothing is how bankruptcy works (and should work).
- wildermuthn 4y agoIt feels sneaky because in these deals someone always seems to get rich except those who who were teased into investing their time (employees with “equity”) or invested with small-money (stockholders) rather than big-money (VCs, banks). I have no idea about the particulars of this deal, so maybe no individual got rich off the deal, and VCs/banks only recouped a portion of their investment. But in my experience, usually a failure still sends up as a success for those who are in a position to negotiate a deal. In other words, Nvidia didn’t do this deal out of the kindness of their hearts — there was still something of value to them that they paid for, and I’d be quite surprised if the board of 3dfx didn’t find a way to capture some of that value personally. Saying that “creditors get paid before shareholders” doesn’t capture the full story of most of these sales, where some equity owners are special and some aren’t.
- bcrosby95 4y agoCommon shareholders get peanuts, C-suite gets tens of millions in retention incentives. Not saying that's what happened here, but that has happened to me in the past. As a small time shareholder what do you do? Assuming its even mathematically possible to do anything.
- dehrmann 4y agoIt was bankruptcy, so I suspect all shareholders got nothing. You're probably thinking of a startup getting bought for less than investors put in and finding about about liquidation preferences.
- cbm-vic-20 4y agoSame here! Retail investors got screwed on this deal.
- dexterdog 4y agoSame here. It was the first and unfortunately last tech stock that I took a gamble on because it failed so gloriously and I was so sure of it.