VENICE (CBSLA.com) — Some local realtors are hoping to cash in on the initial public offering of Snap Inc., the Venice-based parent company of Snapchat.
Snap opened at $24 a share and closed at $24.48 - 44 percent above the initial price of $17.
The company awarded roughly 185 million shares to its employees, making them billionaires and millionaires on paper overnight.
At $24 a share, $4.4 billion is split by 1,859 employees. That comes to about $2.3 million per employee.
The senior-level employees will get a much bigger piece of the pie.
Many employees at Snap are millenials, who have been spending some of their fortune buying up houses. A realtor says she's been getting a lot of calls on a tear-down in Venice with the asking price of a whopping $2.8 million.
"All of a sudden, in the past week, lots of phone calls. I think the anticipation of the Snapchat news has increased the activity on this property in particular over the past week," realtor Robin Walpert says. "I sold a property recently in Venice last year. Had six offers on it. And the winner was a Snapchat employee - 30 years old. Paid cash. Almost $3 million."
Michael Chasalow, a business law professor at the USC Gould School of Law, says it may take a while for the potential business windfall, as employees and investors won't be able to sell right away.
"We're talking about overnight paper millionaires. It remains to be seen whether that paper actually turns into cash," Chasalow explains. "I would say a lot of the mid-level employees have options that are worth from $100,000 to several hundred thousand dollars."
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