VCs do exactly that all the time.
Not true. If Gen'l Atlantic was one of the early backers, which I assume to be the case if they have stock on which they must file a 144, it is certainly significant that they are selling half their holdings. I think it is more common for the VC to distribute shares in large portfolio holdings to the limited partners to dispose of or hold as they see fit. Kleiner Perkins, for example, has made several distributions of shares of AMZN to their investors over the last year. Each distribution, however, was only a small part of KP's AMZN holdings, not half at one time. As for recycling money, successful VCs these days have no trouble raising new money. The hard part is putting it to work in good opportunities. If they thought EGRP had the kind of growth potential over the next 3-5 years that many here seem to think, and if they thought it was not overvalued based on that potential, they would not be selling half their shares. They might distribute some to give their investors the option of selling or holding and allow the fund to book the gain. Perhaps there is something different about their base of investors that causes them to behave differently (if they are all tax exempt investors for example), but selling half of a very large position in a successful investment can hardly be described are ordinary.
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JMO,
Bob (no current position) |
