Priced at $26 a share, Twitter stock started trading around $45 in November and closed its first day of trading at $41.65. Having reached a high of $73.31 in December, Twitter opened today at $35.61 and closed at $31.85, down nearly 18 percent as the lockup period for insiders expired.

While co-founders Jack Dorsey and Evan Williams, CEO Dick Costolo, and Benchmark Capital pledged not to dump any of their shares, trading volume today was ten times higher than average.

Six months ago, one firm had estimated Twitter’s IPO would mint “more than 1,600 new millionaires.” In the words of a plugged-in reader, however, “I would estimate half that, having been through a few IPO’s myself.”

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Comments from “Plugged-In” Readers

  1. Posted by moto mayhem

    whether it is 1600 or 800, adding that much money to local employees has an impact on a housing market with such limited supply. Twitter has been a big boon for SF by making the market street area nicer ,adding more jobs and bringing more highly educated people to SF.

  2. Posted by Sam

    Ha, prepare for areas of the city not used to extreme bidding to be extremely bidded, e.g., closer to Potrero ave in the Mission. Young people with immense cash

  3. Posted by Michael

    Wonder how many locked-up employees have been borrowing against their shares and had to sell to cover the dip? Effective margin call on shares that have already been spent could be painful.

  4. Posted by Jake

    Twitter market value is down 50% YTD.
    Their IPO is a done deal, but their decline may delay or reduce other pending IPOs, particularly ones priced on momentum instead of earnings.

  5. Posted by Wai Yip Tung

    1,600 new millionaires? That’s more than half of their employees when they go public. Where do this information come from?

  6. Posted by Jill

    Most employees got their shares below $3 and those many who started before 2013 got shares below $1. They gave a lot of shares to all levels

  7. Posted by Wai Yip Tung

    If Twitter give a lot of share at all level such that over half of the employees get over a million. Then one can infer over 90% of employees could make more than $500k. That’s an unheard of number.

  8. Posted by anon2

    “but their decline may delay or reduce other pending IPOs, particularly ones priced on momentum instead of earnings.”
    The decline is broader based than just Twitter and it seems box and some others have encountered push back on their IPO roadshows.

  9. Posted by Jill

    “If Twitter give a lot of share at all level such that over half of the employees get over a million. Then one can infer over 90% of employees could make more than $500k. That’s an unheard of number.”
    That’s the beauty of an ipo where large $ flows into a small number of people. My guess is 20% also made over $5m.
    This is happening in biotech too

  10. Posted by JR "Bob" Dobbs

    That 1600 number is overstated. For example, I have a good friend who has been with TWTR since early 2012, hired as a senior manager. Not a grunt, but rather manages a sizable development team. He has 20,000 options, which is way above the median he has said. A good payday for him, and he is elated. But he is not a millionaire (especially after taxes) although he briefly was one on paper a few months ago.
    A very small number of people made gobs of money. Maybe 400-500 more have cracked a million. And a couple thousand with a nice, but not life-changing, bonus. I’m glad this money is pouring into the bay area. And a great tax windfall for California.

  11. Posted by JR "Bob" Dobbs

    Technically, he has RSUs not options.

  12. Posted by anon2

    Keep in mind that options/RSU’s take time to vest and twitter had 22 employees in 2009, 110 in 2010
    Not all of whom have stayed on and some of whom cashed out in the pre-IPO period.
    A lot depends on the road ahead. Even with today’s further drop, at a $17B valuation there could be a lot to go around. But if the market tires of firms with large losses (Twitter has an EPS of -$2.50) valuation and headcount would both be at risk.
    As I said before, the core services of some of these companies have been built up by a shockingly small number of people. Much of the later bulking up has been to fulfill a growth over profit story believed to be desired by the market. But as we’ve seen market sentiment can be fickle.

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