FORTUNE -- When Twitter (TWTR) unveiled its IPO registration last month, a lot of folks were stunned to learn that the company's two largest institutional owners weren't any of the venture capital firms known to have invested in the company. Instead, they were Michigan-based private equity firm Rizvi Traverse (17.9% stake) and entities affiliated with J.P. Morgan (10.3%). Both firms were known to have some Twitter exposure, but significantly more than Benchmark or Spark Capital or Union Square Ventures or Yuri Milner's DST Global? Stunning.
So how did these two firms accumulate such large positions in Twitter without anyone really noticing?
To learn that, you apparently must go back to a story I wrote three years ago. It was about Chris Sacca, the former Google exec and super-angel who had quietly been raising third-party capital to buy shares in Twitter from vested employees and early investors. We reported that he had secured $30 million for a pair of dedicated vehicles, and that he had recently sent out offering docs for a third fund called Lowercase 140 (which I realized was Twitter-related thanks to its name).
When I called Sacca about Lowercase 140, he sounded alarmed. Probably because he only had sent the documents to a tiny circle of prospects (who was leaking?), and also because my story was likely to piss off Twitter (which was notorious for trying to keep all of its secondary sales quiet).
So Sacca killed off the Lowercase 140 effort, and came up with a new strategy. He'd keep raising Twitter funds, but would make damn sure that they didn't look like Twitter funds to folks like me. So when he raised money on behalf of Rizvi Traverse -- and, indirectly, J.P. Morgan (JPM) -- he called one of the vehicles Institutional Associates Fund LLC. Another one was called Compliance Matter Services LLC. And when those vehicles filed Form Ds with the SEC, his name wasn't listed. Neither was an address that would jump out as affiliated either with Sacca (known to live in Truckee, CA) or Twitter (based in San Francisco).
All of this became depressingly obvious upon reading the S-1,and Sacca laughingly copped to it when I asked.
He said it was an old trick he had learned during his Google days, when scoping out locations for the company's first large data centers. Find the most pedestrian-sounding names in the hopes that no one would take a second look.
Each day I skim the latest SEC Form D filings. And there's a 99% chance that I saw both Institutional Associates Fund LLC and Compliance Matter Services LLC, without choosing to click on either one.
Particularly galling is that the new SEC reporting requirements forced Sacca to reveal all of this in IAPD filings, but I never thought to look at those either (despite the rumors of his Twitter-related fundraising prowess).
So I tip my cap to the man who tricked me. And vow to not let it happen again (although, for all I know, he's doing it as I write this).
Sign up for Dan's daily email newsletter on deals and deal-makers: GetTermSheet.com
Electronics maker Jawbone raises new capital to handle excess demand.
FORTUNE -- Consumer electronics startup Jawbone seems to have everything going for it. More than $200 million in venture capital funding. Popular products like the Jambox wireless speaker and the Up fitness-tracking wristband. And a focus on red-hot tech sectors like wearables and the Internet-of-things.
But earlier this year Jawbone ran into a very high-class problem: More consumer demand than it could MOREDan Primack - Sep 12, 2013 10:15 AM ET
Former JPMorgan official Ina Drew say she didn't engage in any misconduct.
FORTUNE -- On Friday, Ina Drew, the former head of JPMorgan Chase's chief investment office and ultimate boss of the London Whale, told a Senate subcommittee that she was misled. What's more, despite the $6.2 billion loss -- one of the biggest in Wall Street history -- Drew believes she did a "reasonable and diligent" job even as the MOREStephen Gandel, senior editor - Mar 15, 2013 11:45 AM ET
The Federal Reserve bank stress test suggests a Goldman risk measure may be misleading.
FORTUNE -- In the last year or so, Goldman Sachs executives have tried to portray their firm, often seen as a Wall Street swashbuckler, as a lot less risky than it used to be. The Federal Reserve appears not to be convinced.
We'll get a better idea of what the Fed thinks on Thursday after the market closes, MOREStephen Gandel, senior editor - Mar 14, 2013 5:00 AM ET
If you look beyond recent mishaps and scandals, there are values to be found in financial shares.
By Russell Pearlman, contributor
FORTUNE -- Disaster and misbehavior have dominated recent headlines about big banks. Whether it's multibillion-dollar trading losses (J.P. Morgan Chase), a settlement for rigging interest rates (Barclays), a Senate report asserting money laundering for drug cartels (HSBC), or assorted bad press for Standard Chartered, Capital One, Wells Fargo, and others, MOREAug 21, 2012 5:00 AM ET
Caught up in the Libor scandal, the star investment banker and American CEO of the British bank was forced to resign. His departure represents the end of an era for big banks.
FORTUNE -- By the time the call came, Bob Diamond knew his tenure as CEO of Barclays was at an end. It was 9:30 p.m. on Monday, July 2, and Diamond had just gotten home from the office when MOREShawn Tully, senior editor-at-large - Jul 30, 2012 5:00 AM ET
Jamie Dimon needs to take a cue from J.P. Morgan's trading debacle and divide the banking giant into manageable pieces.
By Sheila Bair, contributor
FORTUNE – When I was a child, my sister and I loved watching the goings-on at a chicken farm near my grandmother's house in rural Kansas. Chickens are interesting social animals, resembling, somewhat, the way we in Washington interact with one another. They were always on the MOREMay 25, 2012 5:00 AM ET
A number of funds run by former JPMorgan employees are cashing in, but not much.
FORTUNE -- Is Dodd-Frank, the law that is supposed to make the banks less risky, actually to blame for JPMorgan's huge trading loss?
Earlier this year, Neil Chriss, who runs hedge fund Hutchin Hill, said in a Bloomberg interview that he was looking to profit by buying up positions that the large banks might be forced to MOREStephen Gandel, senior editor - May 16, 2012 7:05 AM ET
Customers would benefit, the U.S. government would benefit, and - believe it or not - the big banks themselves would do better.
By Sheila Bair, contributor
FORTUNE -- America is downsizing. Whether it's the food we eat, the cars we drive, or the houses we live in, Americans are concluding that smaller is better. Even U.S. corporations are starting to see the benefit of more Lilliputian institutions; the impending -- and widely hailed MOREJan 18, 2012 10:56 AM ET
After default, emergency restructuring was needed to satisfy lenders.
FORTUNE -- The Forbes family has poked itself in the eye with its "capitalist tool."
Like many publishers, Forbes Media has struggled during the financial crisis. But according to nonpublic documents made available to Fortune, the company has been under more financial strain than previously believed. Forbes Media violated covenants on a revolving credit line that it took out in 2006, according to MOREKatie Benner - Jul 28, 2011 5:00 AM ET
|America's economic mobility myth|
|Snowden docs had NYTimes exec fearing for his life|
|2 million Facebook, Gmail and Twitter passwords stolen in massive hack|
|Tech firms call on U.S. to reform spying activities|
|The shared genius of Elon Musk and Steve Jobs|