Smart Money (VCs) Has Stopped Buying Facebook And Twitter On Private Markets, Now It's Just Dumb Money (Rich People)

mark zuckerbergWait, who owns Facebook shares now?

Photo: AP

Second Market, the private stock trading platform, has posted a bunch of charts on what it saw in Q1 2011.Overall, it completed $115.4 million in transactions for the quarter, with consumer tech companies the most sought after investments.

It also says interest from “high net worth individuals” increased significantly in Q1 as compared to Q4.

The reason for the increased interest? Second Market says startups were more relaxed in their rules about selling shares, and Second Market made it easier for individuals to buy stock.

Consumer products and services (like Facebook and Twitter) were basically the only thing investors were interested in.

Why the shift towards rich people buying private stock? Second Market says, 'private companies continued to become more open to individual investors, minimising usage of Right of First Refusal (ROFR) and allowing more individual investment purchases to close.' It also says that it made it easier for individual investors to buy shares.

Fewer employees are sold shares in Q1. (Perhaps because it's harder now? Or perhaps because IPOs are drawing near?)

The interest in buying Facebook/Twitter/others is significantly outweighed by the interest in selling

Hot web companies are the most watched on the private markets

Foursquare is still a very young company, but it's already getting some major attention

The next hot private companies to see their stocks go crazy on the private markets ...

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