Slack employees offloading shares before it goes public?

Inc. Magazine
journo

Inc. Magazine

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I am a journalist, and a poor one at that. TC <80k I am not going to pay you for tips. DM if you want to chat.
journomore
Jun 18 8 Comments

According to this, Slack employees are trying to sell as much as half their stakes before the company starts trading.

https://www.businessinsider.com/slack-employees-have-sold-stakes-in-the-company-private-market-2019-6

Are you guys worried the stock is going to tank or what?

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TOP 8 Comments
  • Salesforce / Eng
    AnonChickn

    Salesforce Eng

    PRE
    Amazon, Microsoft
    BIO
    I’m an anonymous chicken
    AnonChicknmore
    They’re hedging their bets. After an IPO you’re in a freeze period for 6-12 months and having all your eggs in the public market (especially right now) isn’t smart.

    Sure, if the stock goes through the roof they’re going to lose out on some upside but they’re guaranteeing themselves something right now.
    Jun 18 5
    • Yelp / Eng SQN
      Is there a lockout period even with direct listings like theirs?
      Jun 18
    • Salesforce / Eng
      AnonChickn

      Salesforce Eng

      PRE
      Amazon, Microsoft
      BIO
      I’m an anonymous chicken
      AnonChicknmore
      Almost always, usually 6 months, sometimes a year
      Jun 18
    • Reddit u7hj55
      not on direct listings there isn’t
      Jun 18
    • Salesforce / Eng
      AnonChickn

      Salesforce Eng

      PRE
      Amazon, Microsoft
      BIO
      I’m an anonymous chicken
      AnonChicknmore
      TIL, while my comment holds true for IPO it doesn’t seem to be relevant in direct listings.
      Jun 18
    • Inc. Magazine
      journo

      Inc. Magazine

      BIO
      I am a journalist, and a poor one at that. TC <80k I am not going to pay you for tips. DM if you want to chat.
      journomore
      OP
      There is NO lockup for direct listing
      Jun 18
  • Uber zhdbwb
    This is exactly why lockout periods exist. Of course employees are going to dump large amounts of stock, putting sell pressure on the stock and tanking the price while it’s still volatile.
    Jun 18 1
    • Slack pur12jl
      That is actually incorrect. IPO are actually mostly beneficial only for the ones that buy before, since for 6mo (the lockup period) there will be a forced limited number of shares available on the market, so the supply available is limited - that’s why usually folks see a pop/drop in the first day, since the market “corrects” that initial negotiated price.
      Jun 19