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Comment by smackfu | Hacker News Reader

This is not worthy to be posted here. It's one paragraph in an blog post:

"First, Facebook insiders chose to sell a ridiculous amount of their shares relative to the last major Internet-related IPO, Google. When Google went public, insiders dumped 28% of their shares. Facebook insiders, on the other hand, sold 57% of their shares on Friday."

Comparing two data points isn't exactly rigorous argument. Maybe 28% is low for Google. What is the average? An actual article on this would be interesting. A paragraph in some dude's blog? Pointless.

And really, the correct phrasing should be: "57% of the Facebook stock being offered in the IPO is coming from insiders selling shares."

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It's useful to me. The amount of words doesn't equal the quality of the content.

When my dad asks if he thinks he should buy some Facebook stock, I can tell him the IPO was more about allowing insiders to sell their stock than raise capital. Red flag

I personally look for sourcing and well argued points when evaluating the quality of the content. This has neither, since it's just an aside in a bigger article. The submitter didn't even use the blog title which is the standard here.

This is largely true of most IPOs. Until the dot-com bubble IPOs were to be avoided by investors until the company had a few quarters to prove their business delivers consistent returns.

As most of us in the weeks leading to the FB IPO, I was also asked by friends and family if they should buy stock and the best answer was not to give hard yes/no's because I simply didn't know how the market will react to something this unprecedented.

However, coming from a value investment and algorithmic asset valuation background I explained the problem to them this way:

A Honda Civic is a great car at $20k? Yes.

Is a Honda Civic a good car at $90k? Probably not.

Could you find someone to buy it at that price? Probably.

Should you buy it at that point? That's what buying FB at a $110bn valuation is.

It's still a great car but I'm not going to buy it for that price.

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