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Question for anyone holding stock. A private company has an offer from an investor to buy shares at X, which the company feels is 10% undervalued. However, the company knows of a shareholder (could be you or someone else) who would sell at a 20% discount. Should the company:

tell seller $offer, intro
16.6%
broker midpoint + fees
12.9%
prop buy low, sell high
24%
see results
46.5%

867 votesFinal results

Raoul Pal

@RaoulGMI

Nov 11, 2020

Secondary always sells at a large discount as it doesn't offer new capital to the firm so removed a net source of needed capital.

Jesse Powell

@jespow

Replying to

@RaoulGMI

Agree. Question is what duty does the company have to the seller and other shareholders? Who should take the spread? Should company try to profit from the trade at all or pass up the opportunity to benefit the buyer and/or seller?

1:10 AM · Nov 11, 2020Twitter for iPhone

Replying to

and

Are we talking traditional companies, or new younger lead companies? I think this makes a large difference in the answer.

Jesse Powell

@jespow

Nov 11, 2020

Assume the company is < 10y old.

Replying to

and

Hell0 fucking yes! Especially If it’s a private company and founder(s) is(are) the largest stakeholder(s), unless broker is sorta strategic rails.. worth seeding propagation On that note: let’s offer Kraken to the customers!!! Lets see a real valuation, but then again maybe not

Replying to

and

Companies exist to make a profit.