LinkedIn Chairman Sells Small Stake of Facebook Stock

Bloomberg is reporting that Reid Hoffman, the visionary CEO of LinkedIn, is selling some of his Facebook stock that he had purchased as an early investor in the social network.  It only represents a minority of his overall share in the company, and he claims it is part of a “general diversification strategy.”  This makes sense, but it does raise the question about whether Facebook will actually maintain its current valuation of nearly $100 billion.
Hoffman was part of the seed funding round in 2004, and has held on to the stock since then.  An estimate of his stake is 0.5% of the company, and seeing as he’s holding on to the majority of his shares we can estimate his sale to be up to 0.24% of Facebook – a hefty amount.  Reid is also the largest shareholder of LinkedIn (LNKD) with $1.9 billion of stock given its current price of $99 giving it a market capitalization of 9.8B.
Facebook’s IPO looks to be about $5B worth of stock, and at about 5% of the company, which gives them the $100B valuation.  For more news about the IPO, check out AllFacebook.