There’s a bunch of trades which happen instantly when you IPO. I don’t know exactly how it works, but I think that when my company went public the pool offered in the IPO included stock from priority shareholders. So I’m guessing he effectively sold them to reddit at slightly below initial offer value for them to release to the public as part of the IPO. This way he doesn’t tank the stock by selling off 500k shares on the stock exchange.
He borrowed money on Reddit’s books. Reddit used that money as part of the IPO. Then he sold his shares, and got his hands on the now clean cash money. Reddit is left with the debt? Is this about right?
There’s a bunch of trades which happen instantly when you IPO. I don’t know exactly how it works, but I think that when my company went public the pool offered in the IPO included stock from priority shareholders. So I’m guessing he effectively sold them to reddit at slightly below initial offer value for them to release to the public as part of the IPO. This way he doesn’t tank the stock by selling off 500k shares on the stock exchange.
He borrowed money on Reddit’s books. Reddit used that money as part of the IPO. Then he sold his shares, and got his hands on the now clean cash money. Reddit is left with the debt? Is this about right?