Linden Lab Stock Sinks at SharesPost

by Pixeleen Mistral on 15/07/10 at 11:55 am

The return of Philip Rosedale as interim CEO of Linden Lab has apparently left real world investors unmoved, as offers to sell heavily discounted Linden Lab shares sit untouched at the site. While SharesPost reports sales of Linden stock at $5.50 USD/share as recently as February 2010,  current offers to sell stock go begging at prices as low as $2.50 USD/share – implying a dramatic 50% fall in valuation of the struggling virtual world service provider.

no buyers at $2.50/share

Sharespost specializes in matching buyers and sellers of venture capital-based private companies, and prices can be volatile, particularly for lightly traded offerings. However, the weak demand for even relatively modest amounts of inexpensive Lab stock point to serious problems for investors hoping for a liquidity event in the near term. The offer to sell 10,000 shares at $2.50/share has been open for at least two weeks, and additional offers at $3.00 and $3.72/share are also waiting for a willing buyer. At these prices Linden Lab’s implied valuation is in the $160-239M range.

This is in sharp contrast to the story one year ago. As recently as July 2009, one breathless analyst forecast annual revenues for Linden Lab at $100M USD and valued the company at $678-700M. Whomever is trying to sell half a million dollars of Series B Preferred shares for $5.00/share cannot be happy right now.


Could investor skepticism and the sliding valuation of Linden Lab played a part in the sudden replacement of M Linden? With SharesPost listing a valuation of Linden Lab at $ 140,900,000 as of the close of the last round of venture financing, it appears that there has been little wealth creation over the last few years.  While some Second Life players remain hopeful that the return of Philip Linden will change the trajectory of Second Life, we wonder how much time he has before further drops in the company’s value push investors toward drastic action.

52 Responses to “Linden Lab Stock Sinks at SharesPost”

  1. Patricie Sapphire

    Jul 25th, 2010

    Read the article, then the posts that were focused on the topic!
    Really people, I believe what is happening to LL stock is no different than what is currently going on in markets around the world. When times are tough most investors seek shelter and look for the ” Pay Daddy ” stocks, and of course seek other forms of legitimite currency
    ie: gold, but a little reminder to those of you ready to declare the patient dead, not much over a year ago, Ford stock was worth just a couple of US dollars, in fact they were giving it away with the purchase of a new vehicle with some dealer programs, take a peek where it is now.

  2. walter

    Jul 29th, 2010

    This is normal for stocks to move up or down.

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