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Comment by ComputerGuru | Hacker News Reader

Has anything like this been done before? It's a curious concept. It's certainly costing the company ~nothing (legal, financial, broker fees aside) but it's an incredible gesture to the community that made all this possible. Very clever - and touching!

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Yes, it has been done before. I have worked on several IPOs, and it's common to have a very small tranche for employees, various stakeholders, and "friends". Hence, its not really "news". It's my understanding that this article is just marketing. Etsy wants to come across to sellers as "we care", after a series of quarrels with them.

I was at a creative agency in 2005 which was doing work for FastClick. We had the opportunity to buy "friends and family" shares in their IPO. A number of us did.

Both Red Hat and VA Linux (remember those guys...) offered pre-IPO shares to a long list Open Source contributors who's projects they used.

I love this. but it does cost the company in terms of shares available to their underwriters to sell. and when you assume there will be easy first day gains to be had by getting the shares at the offering price that everyone wants a piece of, I'm sure it took a lot of convincing of their investors & bankers to do this.

Lending Club did it just a few months ago for their IPO. The amount was a bit higher though, I think $4000?

It was up to 250 shares. For customers who had been investors in the companies p2p loan platform since some specified date.

Why the tilde in front of nothing? And doesn't this dilute the value of the stocks hold by current owners?

only if they issued additional shares to do this, which doesn't come across in the S-1

Selling $2,500 worth of shares to their vendors is exactly the same as selling it bankers who will flip it to the public. They get $2,500 no matter what.

It signifies ‘approximately’.

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