Another Failed Facebook Auction At SecondMarket

A week ago SecondMarket failed to clear any shares in its 43rd weekly Facebook secondary market auction. It was the first time that no shares at all were bought or sold.

This week, same thing. The weighted average offer and bid prices converged somewhat, but not nearly enough. Last week the weighted average offer price was $33.91 – this week it was $32.42. Last week’s weighted average bid price was $28.15 – this week it drifted up to $28.47. At $30, Facebook would be roughly valued at $75 billion. Trades were happening in that range back in January of this year.

Buyers clearly want a lower price. And sellers for now aren’t willing to give it.

As a point of reference, about 130,000 shares (about $3.9 million) cleared in the auction two weeks ago on October 7, 2011, and 50,000 shares clear the week before that.

16 thoughts on “Another Failed Facebook Auction At SecondMarket

  1. Faisal says:

    Is this the beginning of the Facebook bubble burst? Only time will tell.

  2. Akhsar Kharebov says:

    Good catch, Mike. Very interesting.

  3. It may be the start of FB bubble burst. I shifted to FB from orkut before most of my friends because it seemed cooler than orkut. But, Now I feels like that I need something else. What that something might be is the question? but its definitely not twitter (at least for me).

  4. john says:

    hahahahahahaha suckerssssss.
    It’s no surprise: They’ve certainly been driving the platform and brand into a ditch for long enough — the ads, the constant changes to the interface and privacy policies, and (most importantly) the de-emphasis of member interaction and shift toward pushing brands.

    • Steve says:

      um, for a company “driving the platform and brand into a ditch”, they sure are doing extremely well (1.6B in revenue and 800M in operating income). They are THE social platform, pretty much globally, and I might add that you point out that they “constantly change the interface”… that’s called innovation, people want new features, and facebook provides them. No one wants the same stale stuff, everyone wants something new and improved (which is what facebook users get).

      You might want to understand business a bit more before leaving comments, you make no sense.

  5. In the long run, I don’t think this won’t be an issue for FB. There are only so many investors with the necessary funds that can participate in a second market auction. If they’d let investors purchase smaller lots, shares would fly off the shelf and the price would likely rise.

    • pothibo says:

      Double negation, me confused. It’s an issue or not?

    • Andy Z says:

      Exactly. There aren’t enough rich people around to buy the shares. We’re low on rich people at the moment. If let the plebes buy in, surely there will be billions of buyers! They will certainly make the stock price explode!

  6. Sam Cornwell says:

    I hope that the people who really care about Facebook (Zuck & co) will be absolutely oblivious to this news.

  7. Sounds like you just described the housing market.

  8. Bob says:

    One word: Deflation

  9. John Bolack says:

    i love Facebook. It has helped me reconnect with some old old friends…. and new ones!

  10. You’re completely missing the point. Facebook IPO is in the cards already, the count down has begun. There have been NO bad news surrounding the company in recent memory, if anything, they are accelerating. So with this in mind, if you’re an owner of Facebook stock, would you be willing to forgo huge gains in 12 to 18 months? You would be short-sighted at the very least.

  11. Rajesh says:

    Definitely over-priced. Obviously no buyers yet!

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