Forbes – David Ebersman, Facebook’s chief financial officer, made the decision to increase the number of shares that would be sold in Facebook’s IPO three days before the big event.The Wall Street Journal suggests this decision doomed Facebook’s shares.
By increasing the amount of shares being sold in the offering and boosting the IPO price to $38, Ebersman was maximizing the amount of money his company, Facebook, would raise by selling its most valuable asset—its stock. But Ebersman was also doing something else. A huge chunk of the expanded part of the offering included shares being sold by principal shareholders, big investment firms like Goldman Sachs that had invested in Facebook prior to the IPO. Facebook would not receive the rich proceeds from the sale of those extra shares.
