Figure AI has issued cease-and-desist letters to brokers operating in secondary markets, signaling a firm pushback against the unauthorized trading of its private shares.
The Battle Over Secondary Market Control
While refraining from addressing the Figure AI situation directly, Sim Desai, founder and CEO of the secondary shares marketplace Hiive, noted that many companies move to block these transactions under the belief that secondary sales represent a “zero-sum game” for the firm.
Desai challenges this corporate perspective, arguing that vibrant secondary market activity can actually heighten investor appetite for primary shares during future fundraising efforts.
Valuation vs. Liquidity
When secondary market activity fails to generate momentum for a primary round, Desai suggests the root cause is rarely a lack of capital. Instead, he points to the asset’s pricing. “If someone is having a hard time selling something, it’s merely a function of price and valuation rather than availability of capital,” Desai explained.
Legal Tensions and Future Outlook
Figure AI has recently faced increased media scrutiny, particularly regarding reports on its partnership with BMW. The company has aggressively refuted these claims, citing significant inaccuracies and even threatening legal action against outlets publishing such reports.
As the company looks toward its next funding cycle, the industry remains focused on two key questions: the scale and valuation of its next raise, and whether current investors will secure the opportunity to liquidate their holdings through secondary transactions.
