This is a what investors call a pop. LinkedIn, the social network founded by Reid Hoffman in 2002, went public with a bang, opening at 84 percent above its offering price of $45 per share. (That figure was itself higher than expected. Just a week ago, the company said it was pricing its IPO at $32 a share.) An hour before the markets closed, the stock was trading at close to $100 a share.
So how did Hoffman do? GigaOm puts his current net worth at a staggering $2 billion; other big winners include Sequoia Capital and Greylock Partner's, which now each hold stakes worth over $1 billion. LinkedIn's CEO is worth a cool $400 miilion.
That's all great, but Henry Blodget, in full cranky glory, points out that in cases like these, founders clearly set their prices too low.
The value of LinkedIn-the-company, it seems safe to say, has not appreciated by 90%+ in the past 12 hours. And that means that, on its underwriters' advice, LinkedIn sold its stock way too cheaply. It also means that the institutional investors who bought LinkedIn's stock last night are high-fiving each other this morning, celebrating their instantaneous 90% gain. (Lots of them are probably also dumping some stock).