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Welcome to edition 636 of Insider Weekends. Insider buying increased significantly last week with insiders purchasing $436.83 million of stock compared to $37.62 million in the week prior. Selling also increased to $631.78 million compared to $582.18 million in the week prior.
A majority of this increase in insider buying was driven by a large purchase of project management software company Asana (ASAN) by its CEO Dustin Moskovitz in a private placement. The company issued new shares to Mr. Moskovitz at a price of $18.16 per share to generate $350 million for working capital and other corporate purposes. About a year ago, Mr. Moskovitz was actively purchasing shares of Asana at prices sometimes approaching $100 per share. Despite the nearly 34% gain in the stock during the last five days after the company released earnings that beat expectations, the stock is still down 75% over the last year as the company continues to post losses and growth decelerates.
Unlike certain SaaS companies that post net losses but are cash flow positive, Asana is posting negative cash flows having burnt through $164 million in cash during the trailing twelve months. At this rate, the company would have been out of cash in a year. This cash from the private placement allows the company to extend its runway as it continues to prioritize revenue growth over bottom line profitability. I wrote the following about the company in June 2021 after a series of insider purchases by Mr. Moskovitz.
Dustin Moskovitz is one of the co-founders of Facebook, making him the youngest self-made billionaire in history in 2011. He co-founded the productivity software company, Asana, in 2008 and the company went public through a direct listing on September 30, 2020. The “reference price” for the direct listing was $21 and it closed its first day of trading at $28.80. It has more than doubled from that first day close to $62.73.
While it is unusual for insiders of a newly public company to buy shares as we highlighted with the Bumble purchases, it is even more unusual to see an insider buy shares multiple times though a defined trading plan (a 10b5-1 plan) as we have seen with Mr. Moskovitz since June 2021. The stock is already up more than $20 a share since he started buying shares. Asana’s market cap is a little over $10 billion and Mr. Moskovitz’s net worth is estimated to be over $21 billion.