Selling shares and going public

Play this lesson

Shares that become money

Carta: "For private companies, a liquidity event is when shareholders can turn their equity into cash." Course 1 met shares and options.

Carta again: "A secondary market transaction happens when one or more investors acquire stock in a company from an existing shareholder, rather than directly from the company in a primary stock sale."

Quick check

An investor buys 1% of Shard Garden from a founder. Does the studio get that money?

  1. No: the founder sold their own shares
  2. Yes, all of it
  3. Half of it
Show the answer

No: the founder sold their own shares

In a secondary sale, the money goes to the person selling. The company's bank balance doesn't change.

Organised sales

Founders like Kai and Remy, who have worked for years on low pay, can sell a small part and keep their focus. Early staff can turn some shares into cash.

A company can run a tender offer: a window when staff may sell up to a set share of what they own, at one price, to chosen buyers. Selling can mean paying tax, so Shard Garden pays for each seller to talk to an independent adviser first.

Do the math

tender offer
Remy owns  20,000 sharesmay sell   10%price      US$5 a share

How much can Remy receive?

  1. US$10,000
  2. US$100,000
  3. US$1,000
Show the answer

US$10,000

10% of 20,000 is 2,000 shares. 2,000 × US$5 = US$10,000.

Going public

A company goes public when anyone can buy and sell its shares on a stock exchange. Usually it sells new shares in an IPO, an initial public offering, to raise money.

Roblox chose a direct listing instead, with trading "on or about March 10, 2021." Existing stockholders sold their own shares, and Roblox "will not receive any proceeds" from those sales.

Quick check

In Roblox's direct listing, who received the money for the shares sold?

  1. The stockholders who sold them
  2. Roblox
  3. The stock exchange
Show the answer

The stockholders who sold them

Roblox sold no new shares. Its existing stockholders sold their own.

Life in public

A public company publishes its results every quarter, and its share price moves every day. Big decisions are explained to thousands of shareholders, not one board.

Many game studios never list, and Kai is not sure Shard Garden should. Going public costs money and time, and quarterly results can push a team toward short-term choices.

Weigh it up

Kai asks the board about going public. Which is a reason to do it?

  1. Raising a lot of money, and letting shareholders sell
  2. Keeping results secret
  3. Fewer rules to follow
Show the answer

Raising a lot of money, and letting shareholders sell

Public markets bring money and a place to sell, with more rules, not fewer.

Quick check

A public company can keep its results private.

Show the answer

False

Public companies must publish their results regularly.

When it goes wrong

Not every plan works. How a studio handles the hard days matters.

Bolt says: Next: layoffs and closures, handled well.

Fact-checked 12 October 2026