Why I’m selling some Twitter shares(medium.com)
medium.com
Why I’m selling some Twitter shares
https://medium.com/@ev/why-im-selling-some-twitter-shares-e5b81386a796
47 comments
Stock sales by executives is normally not a big deal, but 30% is a pretty large number, especially when TWTR is at a pretty depressed price at the moment.
Then again, if he needed the cash, the low stock price increases the amount of stock he needed to sell.
He could write off the loss for tax purpsoses. But I doubt that would make financial sense unless he thinks twitter is screwed. They could get bought out for a premium share price but who knows.
I don't think so. His shares likely have a basis of essentially $0, so he'll pay less taxes on the sale, but only because he's making less money. There's almost never a reason to turn down real income/growth to save a (less than 100%) percentage of that on taxes.
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Mr. Williams, Twitter’s largest individual shareholder with a 6% stake, cited personal reasons for the selling plan, which kicked off Monday. He said he plans to remain on the company’s board and then keep the “vast majority of my assets” tied up in Twitter shares.
“It actually pains me to be selling at this point, but this sale is all about personal context, not company context,” Mr. Williams wrote in a post on Medium, the blogging startup he now runs as chief executive.
Interesting, and 30% would seem to support the notion that it isn't a lack of faith in the company, right? It really does sound like he just needed to be liquid.
“It actually pains me to be selling at this point, but this sale is all about personal context, not company context,” Mr. Williams wrote in a post on Medium, the blogging startup he now runs as chief executive.
Interesting, and 30% would seem to support the notion that it isn't a lack of faith in the company, right? It really does sound like he just needed to be liquid.
What else would he say since he still owns a ton of stock even after the sale?
> What else would he say since he still owns a ton of stock even after the sale?
On the other hand, why else would someone sell 30% of their stock? It's not unusual for someone to announce a plan for complete divestment (usually over the course of several years, to avoid disrupting the market) - that's what Gates is doing with Microsoft, in fact.
If he's holding on to 70% of his stock, it's not like he thinks Twitter is doomed. And as such a large shareholder and board member, it's not like he's just pretending in bad faith to sell only 30% now, but secretly planning on announcing that he's selling the remainder in another year or two. That would be very illegal, and the SEC would come down on him hard.
On the other hand, why else would someone sell 30% of their stock? It's not unusual for someone to announce a plan for complete divestment (usually over the course of several years, to avoid disrupting the market) - that's what Gates is doing with Microsoft, in fact.
If he's holding on to 70% of his stock, it's not like he thinks Twitter is doomed. And as such a large shareholder and board member, it's not like he's just pretending in bad faith to sell only 30% now, but secretly planning on announcing that he's selling the remainder in another year or two. That would be very illegal, and the SEC would come down on him hard.
How exactly would that work? He would just say in a year or two that he decided out of the blue to sell the remainder, and how are you going to prove otherwise?
How and why would that be illegal? He owns the stock. At a certain price it is worth keeping and as the price goes up he has the right to take some off of the table just list as the stock tanks he has the right to secure some of his wealth, especially since he has another company that seems to be his real focus.
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I respect his personal reasons but the stock is public and he is in charge.
I couldn't care if he liquidates 99% of what he has -- what would put me to ease as a shareholder is what is that "personal" reason. Buy a house? New startup? Fight a cancer. Sure, I'm fine... but if that personal reason turns out to be no reason at all, then its a short sign!
I couldn't care if he liquidates 99% of what he has -- what would put me to ease as a shareholder is what is that "personal" reason. Buy a house? New startup? Fight a cancer. Sure, I'm fine... but if that personal reason turns out to be no reason at all, then its a short sign!
> what would put me to ease as a shareholder is what is that "personal" reason
That's easy. A "personal reason" is one that's none of anyone's business ;)
That's easy. A "personal reason" is one that's none of anyone's business ;)
> I couldn't care if he liquidates 99% of what he has -- what would put me to ease as a shareholder is what is that "personal" reason. Buy a house? New startup? Fight a cancer. Sure, I'm fine... but if that personal reason turns out to be no reason at all, then its a short sign!
Did you read the article? He very clearly says:
> Here’s the short story: I like to invest a lot in things I care about. For example, I’m the largest LP at Obvious Ventures, which has invested in over 35 world-positive companies. In addition, my wife and I have done a fair amount of philanthropic giving and—especially in the last year—upped our political donations significantly . These are all efforts to help build a smarter, more sustainable world. I’ve been doing all of them for a while, and I’d like to continue. (In the early days, I also funded Medium, but have not in recent years and don’t have any plans to, thanks to awesome investor/partners.)
Did you read the article? He very clearly says:
> Here’s the short story: I like to invest a lot in things I care about. For example, I’m the largest LP at Obvious Ventures, which has invested in over 35 world-positive companies. In addition, my wife and I have done a fair amount of philanthropic giving and—especially in the last year—upped our political donations significantly . These are all efforts to help build a smarter, more sustainable world. I’ve been doing all of them for a while, and I’d like to continue. (In the early days, I also funded Medium, but have not in recent years and don’t have any plans to, thanks to awesome investor/partners.)
>and he is in charge
@ev runs Medium now, i don't think he's involved in the day-to-day of twitter at all anymore. He's certainly not in charge.
@ev runs Medium now, i don't think he's involved in the day-to-day of twitter at all anymore. He's certainly not in charge.
I'm surprised he waited this long. Twitter's dead and their management doesn't even know it. Yes, it will limp along the same way Yahoo did and eventually they will find a suitor to sell to at a very low, low price.
> I'm surprised he waited this long. Twitter's dead and their management doesn't even know it.
He's a board member, and will continue to be after the sale. He's not selling because he lacks faith in the direction of the company. He's selling because he needs the cash, and as someone who made most of his fortune off of Twitter, most of his money is tied up in Twitter stock. As a board member[0] and large shareholder, he needs to make a public filing along with that sale.
If he were selling 80% of his stock, or if he were announcing his intention to step down from the board as well, I might agree with you (but also might point you to Bill Gates, who announced his decision to fully divest from Microsoft a while back, in order to fund his foundation's work). But he's selling less than a third of what he owns, and he's clearly remaining involved with the company in a capacity that bears a fiduciary responsibility.
[0] This really cannot be overstated; board members are not merely shareholders, and it's not a liability-free position. If Williams were seriously pessimistic about the future of Twitter as a board member, selling 30% of his shares and doing nothing else would be the most nonsensical way to act on that pessimism.
He's a board member, and will continue to be after the sale. He's not selling because he lacks faith in the direction of the company. He's selling because he needs the cash, and as someone who made most of his fortune off of Twitter, most of his money is tied up in Twitter stock. As a board member[0] and large shareholder, he needs to make a public filing along with that sale.
If he were selling 80% of his stock, or if he were announcing his intention to step down from the board as well, I might agree with you (but also might point you to Bill Gates, who announced his decision to fully divest from Microsoft a while back, in order to fund his foundation's work). But he's selling less than a third of what he owns, and he's clearly remaining involved with the company in a capacity that bears a fiduciary responsibility.
[0] This really cannot be overstated; board members are not merely shareholders, and it's not a liability-free position. If Williams were seriously pessimistic about the future of Twitter as a board member, selling 30% of his shares and doing nothing else would be the most nonsensical way to act on that pessimism.
>He's not selling because he lacks faith in the direction of the company
Personally, I don't question his motives, but you seem assured of something impossible for you to actually know.
It's at least questionable to have waited until Twitter was scraping its all time lows, and then selling a huge chunk of stock. He just learned he might need money yesterday?
Personally, I don't question his motives, but you seem assured of something impossible for you to actually know.
It's at least questionable to have waited until Twitter was scraping its all time lows, and then selling a huge chunk of stock. He just learned he might need money yesterday?
Where is this feeling coming from? There's only fb, twitter & instagram, no? I'm not seeing people using their phones less..
As a company/organization, Twitter is dysfunctional. I've had a friend quit from Twitter because all the other smart folks around him were leaving...leaving only the rent-seekers. I'm not saying all the smart folks are gone, but there has been a brain drain and it's been well deserved. Jack Dorsey hasn't done a thing to fix Twitter and yet they keep him on.
A huge number of people still use Yahoo Mail, and some use their photo offering.
It does not put Yahoo's finances in a good shape, though.
If Twitter could slash their expenses drastically, they could be rather profitable. Maybe they could increase their income somehow, too. Likely the same applies to Yahoo, and is equally problematic.
It does not put Yahoo's finances in a good shape, though.
If Twitter could slash their expenses drastically, they could be rather profitable. Maybe they could increase their income somehow, too. Likely the same applies to Yahoo, and is equally problematic.
Snapchat?
Ed, NM just got bit by fake news.
Snap is not a part of Facebook, they're independent and looking to go public.
Snapchat had its IPO last month http://www.cnbc.com/2017/03/02/snapchat-snap-open-trading-pr...
Missed the boat, unfortunately. Selling at the height of the hype cycle eould have been much better.
Selling at a record low price for Twitter is probably not the most financially sound logic.
Neither is having ~90+% of your net worth in a single, highly volatile equity.
Given the title it's amazing that he never actually explains why he's selling.
I think it's pretty clear: he's selling so he can invest in do-good-things-for-the-world causes. It's understandable that he didn't care to name the specific recipients of the funds he'd get from the sale; that's no one's business as of now.
The only reason he posted this piece was to stave off the otherwise-inevitable "Twitter Co-Founder and Board Member Sells a Third of His Stake: Does He Not Believe in the Company?" headlines.
Though his "It actually pains me to be selling at this point" bit in his post is almost certainly to be translated as "I'm disappointed that I have to sell when the stock is in the dumpster".
The only reason he posted this piece was to stave off the otherwise-inevitable "Twitter Co-Founder and Board Member Sells a Third of His Stake: Does He Not Believe in the Company?" headlines.
Though his "It actually pains me to be selling at this point" bit in his post is almost certainly to be translated as "I'm disappointed that I have to sell when the stock is in the dumpster".
I thought he pretty clearly explained he wanted it to fund other investments and charitable giving?
Sounds a little like the usual "I want to spend more time with my family" explanation when someone leaves
He's got a VC fund called Obvious (mentioned in the post). If you want to know more details their portfolio is listed here:
https://obvious.com/portfolio
https://obvious.com/portfolio
Wanting to spread your investment is a normal concept, as is keeping your investments secret.
He alludes to a reason rather than saying it is the reason. That is the tell. He is not being completely forthright.
Yea interesting... I continued scrolling down thinking there was some build up toward a greater good. It turned out to be: I'm selling my shares to spend money elsewhere, and possibly donate some too
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Evan Williams' post on the sale: https://medium.com/@ev/why-im-selling-some-twitter-shares-e5...
Thanks; changed to that from https://www.wsj.com/articles/twitter-co-founder-evan-william....
Whether you believe his reasoning or not, I think it's an entirely valid reason to sell. He needed cash, his entire liquidity is in $TWTR. What else is he going to do if he needs personal cash, take a loan?
> What else is he going to do if he needs personal cash, take a loan?
If he believed in the stock, why not?
If he believed in the stock, why not?
You could still run into issues. Imagine twitter stock crashed and you took out a large loan, you're still on the hook for that amount and now you don't have any assets. I would also assume that the ventures that he claims to be going into (charitable donations/VC funding) would require you to have the assets in hand.