In April, Zynga conducted a “secondary stock offering” in which insiders dumped 43 million shares of stock at $12 a share, raking in about $516 million.
Yesterday, four months later, Zynga reported a horrible quarter, and the stock plunged to $3.
In other words, Zynga insiders cashed out at exactly the right time.
In fact, they cashed out in the same quarter in which Zynga imploded.
The quarter had already begun when Zynga insiders shoveled their stock out the door.
By the time the quarter ended, Zynga’s business (and stock price) was in the tank.
According to Blodget, CEO Marc Pincus made $200 million off the stock sale, and two venture capital groups that invested on the company made over $60 million each on the sale. But he’s careful to note that it likely wasn’t intentional, and that “the amount they made in the sale, though huge, is still relative chicken-feed for them.” Catch up on this story over here.
» Portfolio includes Facebook, Skype, Instagram, Zynga: Netscape co-founder Marc Andreessen’s Andreessen Horowitz, which in just three years has become one of Silicon Valley’s best-known venture capital firms, plans to take some of its expected future profits and put them to the good of the world at large. While the firm isn’t at the point where it has massive profits yet, considering it’s had at least two major buyouts already — Skype to Microsoft and Instagram to Facebook — their track record is looking solid and the end result of the firm’s work could mean tens of millions going to charity, at least. The six partners don’t have a set timetable or preferred non-profits in mind, but we suggest the one that made this video as a starting point.
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As we wait to see just how involved Arrington will remain, as a media company that should supposedly hold up some sort of journalistic ethics, AOL is coming out looking quite sleazy.The Atlantic Wire’s Rebecca Greenfield • Offering her take on the debacle revolving around Michael Arrington and TechCrunch. Here’s the issue we see, as outsiders: Michael Arrington has always been as much of a player in Silicon Valley as he’s been a journalist, so there’s always been a small conflict of interest there. But by making the “player” element a bigger part of his job title by creating a venture capital fund, he makes himself a target. But wait. Tech journalism is already incestuous and ethically broken. A few examples: Business Insider’s Henry Blodget was once a financial analyst barred from the securities market for fraud. The WSJ’s Kara Swisher is married to a female Google exec (which she discloses). And Gizmodo parent Gawker Media pays for stories that can draw millions of eyeballs to their sites. The difference is that AOL, which bought TechCrunch a year ago, is a big company that knows better. Or should. And the end result is that it makes AOL look really bad. source (via • follow)
» Suggestion: As you move forward, Ben Huh and company, consider paying your entry-level employees more. Just saying.
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