Vince Thompson doesn't appear in any accounts of Facebook's early years. Few of the more than 2,000 employees at the company even know his name. The AOL (AOL) veteran's brief stint as Facebook's first official ad-sales chief lasted less than six months. Even so, when Thompson left the company in early 2006, he exercised his options to buy Facebook stock, as is the custom in Silicon Valley, and took a sizable chunk of shares with him. About 18 months later he moved to Los Angeles and started consulting for media clients such as TVGuide.com on how to tap new sources of revenue, and he began to think about how to create one for himself. He set out on a quest, talking to friends in the New York investment banking world about an unorthodox idea: selling a portion of his Facebook shares, packaged with those of a colleague who left Facebook shortly after he did. (Thompson declined to comment for this story.)

The idea seemed highly impractical since Facebook wasn't—and still isn't—a public company. Who would buy his shares? How could any outsider value a small, private company with hardly any revenue?

One banker introduced Thompson to a New York firm called Restricted Stock Partners, which in mid-2007 had a small office near Battery Park with two windows that looked onto a brick wall. The firm specialized in facilitating trades of illiquid securities, such as assets of bankrupt companies and preferred shares in public companies whose holders have special rights. Moving Facebook stock would be an altogether different kind of transaction, but the tiny firm had been looking for a chance to break into the market for private-company stock.

The resulting experiment stretched out several months, primarily because prospective buyers couldn't come to terms with Thompson on a price. Finally, using Microsoft's (MSFT) $240 million investment in Facebook in October 2007 as a guidepost, a hedge fund purchased the shares at a price that valued the fledgling social network at ...