"Investors were looking at this company as they did many other things they invested in."
tl;dr: Investors were looking for the IPO pop and then dumping it. Problem is, if everyone follows that idea, there's no upside left.
It was obvious from when FB first started trading on SecondMarket that the "IPO pop" would happen before the IPO. The IPO pop stems from a supply/demand mismatch (lots of people want to get in but are unable to). And because the accredited investors got in before the IPO, the only people left were "retail" investors (and we know how that story ended). Many analysts and investors don't understand that key point, which is why a lot of people were caught with their pants down.
Comments
"Investors were looking at this company as they did many other things they invested in."
tl;dr: Investors were looking for the IPO pop and then dumping it. Problem is, if everyone follows that idea, there's no upside left.
It was obvious from when FB first started trading on SecondMarket that the "IPO pop" would happen before the IPO. The IPO pop stems from a supply/demand mismatch (lots of people want to get in but are unable to). And because the accredited investors got in before the IPO, the only people left were "retail" investors (and we know how that story ended). Many analysts and investors don't understand that key point, which is why a lot of people were caught with their pants down.