One of the big appeals of direct listings, when companies go public simply by listing their existing shares rather than by selling new shares, is that they allow investors and employees to sell their shares immediately. Palantir, which plans to lock up about 80% of its investors’ shares despite having a direct listing, just undercut that appeal.
Our report suggested Palantir wanted to avoid investors selling too much of their stock in the early months. The company is 17 years old, so there may be pent-up demand to sell, although as the company had an active secondary market, anyone desperate to sell could have already unloaded.
