You bought it. They sold. Meet some insiders who have unloaded 35 billion

A year ago, Heather Hassan and Katherine “Trina” Spear flew from Santa Monasia, California to New York to ring the opening bell of the New York Stock Exchange. FIGS’s co-chief executive, an online retailer of expensive clothing for healthcare professionals, is delighted with their initial public offering, with people joining them on the Bell podium wearing stylish medical scrubs.

FIGS has capitalized on some strong epidemic-era trends and, at the IPO, its shares sold for $ 22, raising 580 million. FIGS IPO has even tapped into the retail market, becoming the first IPO to be made available to users of the Robinhood Trading App.

However, most of the money raised in the IPO did not go to the company. Instead, $ 450 million went to Tulco Holdings, a company owned and operated by Hollywood movie studio billionaire Thomas Tool. Tool holding company FIGS invested about $ 65 million in FIGS,
-5.99%
Over the past four years and has become its largest shareholder, the securities filing shows.

Speaking from the floor of the New York Stock Exchange on the day of the IPO, Spear said: “We actually think these numbers are somewhat neglected.”

With fashionable face masks and a direct-to-consumer online model that has become popular with investors, FIGS shares have risen sharply to 50. Four months after the IPO, in September 2021, FIGS announced a secondary offer at $ 40.25 per share.

This time Hassan, 40, and Spear, 38, were in action. In the secondary offer, Hasson sold $ 94 million FIGS shares and Spear sold $ 59 million, the securities filing shows. Tull’s company has sold another stake in FIGS shares in a secondary offer. Overall, Tull’s company sold $ 822 million worth of shares from the IPO, according to an analysis of securities filings conducted by research and analytics firm VerityData.

But this year, investors have begun to question the growth story of FIGS and the general outpouring around new direct-to-consumer models. Wall Street analysts are skeptical that the total address market for stylish scrubs is as big as Spear’s demand. Investment bank Cowen, for example, kept a note that the market is much harder to pin and the employment of healthcare workers seems to be slowing down.

Shares of FIGS have declined. The stock recently traded at 10. 10.16, 54% lower than the 2021 IPO and 75% lower than FIGS’s secondary offer. Those who bought and held the $ 975 million shares of Tull’s company, Hasson, and Spear sold at a huge loss. The entire company was valued at $ 1.7 billion.

“After the company was formed and its value increased for more than a decade, FIGS co-founders Heather Hassan and Trina Spear sold a small percentage of their total holdings in the same period and the amount FIGS shareholders were allowed to sell on IPO lockup terms. . FIGS said in a statement. “Although macro conditions subsequently affected the overall stock market, Heather and Trina continue to invest more than anyone else in the long-term success of FIGS as two of the company’s largest shareholders.” Tull declined to comment.

With the rise of the stock market, 2021 was an IPO bonanza. More companies are listed on the U.S. stock exchange in 2021 than in any other single year, through traditional IPOs, direct listings and special acquisition companies or SPACs. Dealogic says more than 1,000 new companies have listed their shares on the US exchange and raised $ 315 billion. Wall Street investment bankers have pushed every company they find in the public market by accepting $ 10 billion in fees for their efforts. Goldman Sachs GS,
-1.05%,
JPMorgan Chase & Co., JPM,
-1.14%
And Morgan Stanley MS,
-1.67%
Each IPO booked more than $ 1 billion in revenue.

Today, many companies listed on the stock exchange last year are trading below their IPO price. But when investors lost money, many insiders – CEOs, executives, venture capitalists and other primary financial backers – were able to cash in significantly.

There have been some big sellers. Dating App Operator Bumble BMBL,
-2.03%
It raised ারে 2.4 billion in its initial public offering last year by selling shares for 43. Most of that money went to the company’s main shareholder, Wall Street Behemoth Blackstone Group, which sold ্ব 2.19 billion worth of Bumble’s stock, according to the securities filing. Shares of Bumble now trade at around 27 27, 37% less than the IPO. Blackstone BX,
-1.88%
Declined to comment.

According to Veritadata, insiders sold ির 35.5 billion worth of stocks of public companies in the United States in 2021. Some insiders bought, but they only bought publicly traded stocks of companies listed on the U.S. exchange last year for $ 7.6 billion. Tull, for example, recently purchased G 7.25 million in FIGS stock.

“When the market heats up, you want to find companies trying to take advantage of the foamy market for new offers, and you’ve seen that with the 2021 IPOs and SPACs,” said Ben Silverman, research director at VerityData. ”

Coinbase, Coupang, Playtika, Robinhood, Honest Co.

Less than a year ago, Robinhood Markets co-founders Baiju Bhatt (left) and Vlad Tenev were smiling as they walked Wall Street on Robinhood’s IPO listing day. The stock has since declined 73%.

Getty Images for Robinhood

In April 2021, Coinbase, the operator of the country’s largest cryptocurrency exchange, listed its shares on Nasdaq via a direct listing, evading the traditional IPO process that featured expensive investment banking fees. “I was excited about the live list,” said Coinbase COIN.
-4.86%
At the time, CEO Brian Armstrong said. “I feel that this is more true to the principles of crypto.”

Armstrong went on to say that the direct listing process would provide a more accurate market value for Coinbase’s shares, “rather than a guess,” which was set “behind closed doors and (by a small number of participants)”.

Another difference with the direct enrollment process was that there were no underwriters who could set up a lock-up ban on internal sales for six months or more. The reference point for the Coinbase IPO was $ 250, but the stock rose to $ 388 on the first day of trading. At this and other levels, Fred Wilson, who sat on the board of Coinbase, pressured his venture company, Union Square Ventures, to unload all its Coinbase stock to 1. 1.8 billion.

In total, Coinbase Insiders unloaded $ 3.5 billion Coinbase shares from the IPO. According to Veritadata, Coinbase’s biggest seller is Coinbase co-founder Fred Ehrsam, who has sold ন 492 million worth of Coinbase stock; Armstrong, who sold 292 million; And Emily Choi, president of Coinbase, who sold $ 231 million.

With the price of Bitcoin BTCUSD,
-3.51%
And with other cryptocurrencies sinking in recent months, Coinbase’s financial performance has taken a serious hit. Its stock has dropped to $ 70, which is 72% below its IPO reference price, and insiders, such as Union Square Ventures, are down 82% from its high level of unloading the stock. Coinbase and Union Square Ventures did not respond to a request for comment.

The role of venture capitalists was huge in the 2021 IPO sales frenzy. In 2016, Masayoshi Sun, billionaire founder and CEO of Japanese holding company SoftBank, announced that Softbank had raised $ 100 billion in Vision Venture Capital Fund to invest in new technology companies. Coupang CPNG is one of the companies that SoftBank supported.
+ 2.28%.

SoftBank initially invested in Korean online retailers in 2015, but Vision Fund doubled in the company and became the largest shareholder in SoftBank Coupang, a securities filing show. Last year, Kupang decided to list its shares in the United States, conducting a huge IPO on the New York Stock Exchange. Kupang sold shares for 35, raising 4.55 billion.

Six months after the IPO, in September 2021, Softbank began selling its Kupang shares while they were trading at $ 29.69, according to a securities filing. It sold $ 1.69 billion in Kupang shares last year. This year, as speculative frenzy around technology companies began to break out, Softank sold another $ 1 billion in Kupang stock, bringing the total Kupang sales to 2.69 billion.

SoftBank’s stock sales and Coupang’s ongoing financial losses have put the company in a weak position as investors have revalued risky assets this spring. Shares of Coupang recently traded at $ 13.17, down 62% since its IPO.

Softbank is selling stocks of other companies which has pushed it to the US stock exchange. In June 2021, Sofi Technologies SOFI,
+ 3.62%,
An online personal finance company made its debut on Nasdaq after merging with a special acquisition company called Social Capital Hedosophia or SPAC, which sold IP 10 per share in its IPO. As Nasdaq rose last year, Sofi made a secondary offer at 21 21.60 per share where SoftBank sold a portion of its holdings for $ 486 million. In total, Sophie’s insiders sold $ 984 million worth of shares. Sofi’s stock recently traded at $ 7.05. SoftBank did not respond to a request for comment.

To some extent, the boom of speculative technology stocks at the top in 2021 was driven by Robinhood Markets, which operates trading apps that became extremely popular with retail investors during the epidemic. Robinhood conducted its IPO last July, selling its stock at $ 38 and raising 1.89 billion, a large portion of which came from private investors and Robinhood users. Its two founders, Vlad Tenev and Baiju Bhat, each sold $ 45.5 million worth of stock with the offer. Robinhood stock hood,
-1.09%
Recently changed hands for 10.06, which is 73% less than the IPO price. Through a spokesman for Robinhood, Tenev and Bhatt declined to comment.

Israeli mobile game maker Pletica Holding PLT,
-2.83%
Launching its IPO in January 2021, it sold its shares on Nasdaq for 27 per share, raising $ 1.9 billion. Most of the IPO proceeds went to Platica’s main shareholder, Alpha Frontier, which pocketed a total of $ 1.66 billion from the sale of its Platica shares. Alpha Frontier, owned by a consortium of Chinese investors led by Shanghai billionaire Shi Yuzhou, shows securities filing. Marketwatch could not be reached for comment and Pletica declined to comment. Shares of Platica recently traded at 14.15, down 48% from its IPO price.

Then there are honest companies. The Jessica Alba-backed company went public in May 2021, selling শেয়ার 16 million each and raising 474 million. The IPO proceeds went mostly to El Caterton, which received $ 297 million. Scott Dahanke, co-CEO of a private equity firm, sits on HNST, an honest company.
-6.30%
The board today, honest company stock changed hands for $ 3.57. El Caterton declined to comment. Alba has never sold a single share, both before and after the Honest Company’s stock fell 78% since the IPO.

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