Are "Commoners" Overvaluing Twitter and Facebook?
NYPPEX Private Markets tomorrow will release new research, arguing that secondary market investors are overvaluing VC-backed Internet juggernauts Twitter and Facebook. Specifically, the New York-based group believes that individual investors using private-market stock exchanges are paying VC-sized valuations without the corresponding benefits. Take Twitter, which recently raised around $98.2 million of Series E funding at a $1.13 billion post-money valuation ($15.98 per share). NYPPEX says recent “odd lot” bids for the company have been at a $1.29 billion valuation, or $20 per share. A big different, of course, is that the Series E round consists of convertible preferred stock with a 1x liquidation preference. The “odd lot” shares, on the other hand, are plain vanilla common stock. In other words, folks buying on secondary exchanges are paying more for less.
