A Poshmark seller nabbed over $12,000 by buying stock in the company's successful IPO. Here's how she did it.
Tiffany Wood
- Poshmark seller Tiffany Wood now has a $12,000 nest egg because she bought stock in the company's initial public offering.
- Poshmark reserved 330,000 shares in the IPO for super users, according to the S1 filing.
- In a leaked email to Insider, Wood shared details of how Poshmark allowed her to buy into the IPO.
- Visit Business Insider's homepage for more stories.
Tiffany Wood, 30, has been a Poshmark seller since December, 2015, spending an average of about 30 minutes a day on the site.
Thanks to Thursday's spectacular IPO, Wood and her husband are among the Poshmark users making money from the stock, too.
Wood told Insider she purchased 149 shares at $42 a share, the initial share price. Poshmark opened at $96.50 Thursday, meaning her stock was up an exciting $14,378 on the first day. She didn't sell immediately and by market's close on Friday, shares were trading at $83.20. Her stake is still worth $12,397 with a healthy profit of $6,139. And she's thrilled.
Poshmark set 150 as the maximum amount of shares available to top users.
In a leaked email to Insider, Wood shared details of how Poshmark allowed her to buy into the IPO.
"Poshmark is setting aside a percentage of shares in the IPO for a Directed Share Program ("DSP"). The DSP allows Poshmark to invite eligible POSH Ambassadors and certain 'friends and family' to participate in the IPO and buy Poshmark shares at the IPO price, subject to minimum and maximum share purchase amounts," according to a screenshot of the email seen by Insider.
The email also instructed participants to open a Fidelity investment account to administer the stock sell.
Poshmark defines ambassadors as users who make at least 15 sales, have at least 50 available listings in their closet, and have an average rating of at least 4.5 stars. In total, Poshmark reserved 330,000 class A shares in the IPO for these super users at the initial public offering price, according to the S1 filing. To qualify, users also have to reside in the United States, and have made at least one sale on the platform between January 1, 2020 and December 2, 2020.
About 4,000 Poshmark users were able to participate and become shareholders, according to a Bloomberg News report. A Poshmark spokesperson said she was unable to confirm that number, and could not share additional details about the program.
Besides selling on Poshmark, Wood is also a special ed teacher in Brooklyn, New York. She told Insider that when she sells, she plans to use some of the IPO money to buy material for her classroom and items for her baby. "If there's some money left, I also really need a new laptop," she told Insider.
Poshmark is not the first tech company to offer users to buy shares in the IPO. In December, Airbnb also set aside up to 3.5 million non-voting shares for hosts, making up about 7% of the total offering.
"I'm so proud that there'll be thousands of community shareholders as we become a public company," Poshmark CEO Manish Chandra told Insider.