The following article titled, "Early Facebook Investor Peter Thiel Unloads Stake" was published in the Wall Street Journal on August 20th. The better title to me would have been, How to Turn $500,000 into a Billion! The article goes on to say that Mr. Thiel had the good sense to invest $500,000 in Facebook in 2004 when the company was only worth $4.9 million. Your response could be that $500,000 is an awful lot of money to bet on something. That might be true for you or me, but one of Mr. Thiel’s earlier winning bets was founding PayPal in 1998 and later selling it to eBay for $1.5 Billion. Despite the beating Facebook’s stock has taken, I don’t think Mr. Zuckerberg is doing too bad either.
"Peter Thiel, Facebook Inc.'s earliest investor and a board member, has sold the majority of his shares in the social network, as restrictions on insider selling begin to lift.
Mr. Thiel, a partner at venture-capital firm Founders Fund, invested $500,000 in Facebook in 2004 as its first major investor when the company was valued at a mere $4.9 million. Mr. Thiel has now made more than $1 billion from his Facebook investment, and he still owns stock worth about $112 million. On Monday, Facebook's shares rose 5% to $20.01.
In a filing Monday, Mr. Thiel disclosed that he sold 20.1 million Facebook shares, and distributed another 2.2 million shares to investors, as part of a selling plan known as a 10b5-1 plan that he agreed to in May. The sales leave him with about 5.6 million shares.
Mr. Thiel sold the most recent tranche of Facebook stock for an average of $19.73 a share late last week, netting him about $395.8 million. Had he sold the 20.1 million shares at the time of the IPO—when the stock price was $38—it would have been valued at $762 million.
But Mr. Thiel will still make an immense profit on his small bet. He already sold some Facebook shares before the company went public, and in the May public offering, sold 16.8 million shares for $638 million."
Continue reading the full article here.
J. Robert Saron
President
Bovie Medical Corporation
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