
Andreessen Horowitz Sells a Third of its Facebook Shares - uladzislau
http://allthingsd.com/20131109/andreessen-horowitz-sells-a-third-of-its-facebook-shares/
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jhonovich
There's no value to A16Z's investors for A16Z to hold shares in publicly
traded companies. If the investors want to, they can buy shares directly and
not through a VC firm.

The value to these investors is access and expertise in selecting private
companies, not holding shares in public ones.

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rhaker
point well made, though, there may be U.S. tax reasons that would influence
the timing of sales (e.g. offsets in their portfolio)

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confluence
Facebook is about 4x over fair value, so it's a pretty decent sale. It's too
bad for the public investors that bought that shit up though. There should
probably be a basic financial test that people should have to pass before they
get access to a brokerage account. At some of the prices I'm seeing stock
clearing, it's obvious that the buyers have not actually read any financial
reports.

Something like a basic written comprehension test on a random 10-K filing
would efficiently and cheaply filter out those who are, and aren't, qualified
to manage their own money. In fact, I'd wager that it'd probably reject a
whole bunch of finance/eco/accounting majors as well.

If you don't know your balance sheet, from your income statement, from your
FCF, from your capex, then you probably don't have any business buying or
selling financial assets. To anyone who says that this is an unfair statement,
I have no knowledge of airplane mechanics, and hence, I probably have no
business repairing airplanes. The same reasoning applies to investments.

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MarcusBrutus
Bogus analogy. You have no business repairing airplanes because you may
endanger lives. People should be free to squander their money in their folly
if they so choose. Otherwise outlaw lottery, gambling and horse-racing as
well.

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confluence
Why not outlaw lottery, gambling and horse-racing?

People misallocating capital is just as dangerous as an airplane mechanic
misplacing a bolt on a Cessna. Both actions end up, in the long run, with
people dying.

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rwmj
Most societies do try to control gambling because of the social problems it
causes.

However this has nothing much to do with misallocating capital (after all, if
they're misallocating it in gambling, why do you think they'd be smart enough
to do any better if not allowed to gamble?) If you truly want to try
allocating that capital better than the former owners of the money, buy shares
in gambling companies.

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kayoone
TLDR Nothing to interesting, they got in relatively late and are now selling a
part to give it back to investors while still keeping the majority of their
shares, so this has nothing todo with them not trusting in Facebooks vision
any longer.

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blisterpeanuts
But if they still believed in FB's vision, why would they dump so much stock?
1/3 sounds like a lot to me.

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tptacek
If they don't believe in FB's vision, why would they retain 2/3rds of their Fb
holdings? What a silly comment.

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Retric
Because dumping enough stock reduces the price so waiting a a week or more
between sell offs is a good idea.

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tptacek
Obviously nobody js going to remember you saying this a week from now when
they don't in fact unload another block of Fb, or reconcile the comment
against Fb's price next week. It's just typical message board BS, is the bet
I'm willing to place.

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carrotsarm
Good Timing. No data to back what I'm saying, but I don't see FB going up any
further. The time spent by me (almost none) and my other non-techie friends
has decreased drastically on the website and I still don't see a very
effective monetization strategy.

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majani
They still have two billion dollar opportunities that they are sitting on:

1\. An Adsense competitor 2\. Video ads

These are not wild predictions of possible revenue streams. Facebook has
already launched these features to select partners and when they are launched
to the public, their stock will jump a lot more.

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sharkweek
I am waiting for a good explanation as to why they haven't started an Adsense
competitor yet; seems like it would be a goldmine

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majani
Facebook's game is to show that they can act on the grand old online media
promise: that they first get loads of users, then later they can turn on the
revenue streams and the cash comes pouring in.

Facebook is living up to this promise with the way they turned on mobile ads
and they are now bringing in over a billion dollars annually. I think they
want to maximize on that opportunity first, then turn on another revenue
stream after mobile ad growth starts to slow. If they pull this off, they will
be Wall Street darlings

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coralreef
Total value of said sale?

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pkrumins
Andreessen Horowitz owns .25% of facebook. A quick calculation shows that the
sales value at yesterday's close is around $100M.

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eriksank
Since they know who you are, and since the central banking database knows how
much money you have in what bank accounts, and since they know who your
friends are, it is no problem to demographically calculate that you could
reasonably get a heart attack now. Of course, you made quite a few strange
large purchases just before you died, but only your friends would know that
these were strange. Your balance is pretty much gone. You seem to be no longer
keeping them up to date on what you are doing? Facebook is simply a gold mine,
because any money that you are holding in bank accounts forms collectively a
bounty on your head.

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pearjuice
"A pyramid scheme is an unsustainable business model that involves promising
participants payment or services, primarily for enrolling other people into
the scheme, rather than supplying any real investment"

"By selling some of its holdings, she said the firm is able to return cash to
its investors."

 _welp_

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nkohari
The amount that you misunderstand what you're talking about is staggering.

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loceng
The point is they're not that confident the stock will go up much more. Sure,
you could look at it as spreading risk.

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acjohnson55
If that were true, they would liquidate much more aggressively. I don't know
how much total value in shares they have left, but if you're a venture
investor, your goal isn't to tie up all your money in ventures that have
already broken through; your goal is to find the next one. If all they wanted
to do is go long on stocks, they could do that without all the venture
investing.

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loceng
If they started to liquidate quickly, so would everyone else - and they'd piss
off their co-investors too if they didn't do it fully planned out. Regarding
going long on investments in a different way - that won't bring them the same
return.

