[Updated: Facebook has confirmed the employee stock sale program.]

Facebook has an internal valuation of $4 billion, as we’ve previously reported. It will begin letting current employees sell 20 percent of their fully vested stock options at that valuation, starting this fall, I’ve learned from well-connected sources.

Facebook isn’t commenting. But this is a nice early windfall for Facebook employees, assuming my sources are correct. Other “liquidity events,” like an initial public offering or a purchase of the company itself, are looking unlikely. Facebook has said it’s not planning to IPO anytime soon, and it has rebuffed multiple purchase offers over the years — instead raising hundreds of millions of dollars as it seeks to become a big business.

Indeed, this move incentivizes current employees to stay with the company while simultaneously allowing them to reap some of the benefits of their hard work.

Some former employees — who have left for a wide variety of personal reasons, I’ve separately learned — have been selling their vested stock at around this valuation. Unlike current employees, former employees don’t need permission from the Facebook board of directors to sell stock.

There has been at least one report of a former employee selling stock at an implied valuation of at least $6 billion, although other reports point to market-based stock sale valuations closer to $4 billion.

The company officially derives its $4 billion number based on a legally-mandated internal estimate of its worth, that it provides the Internal Revenue Service multiple times per year.

So, going forward, once these stock options go on sale, the market could very well determine that Facebook is worth more internally than the company believes itself to be.

Notes about how this all works:

Stock options set a certain amount of stock at a certain price at the date the options are issued to the employee. These options give the employee the right to first purchase the stock at that original price then resell it for the higher valuation, later, and make a profit. These options “vest” or become available for purchase, based on a preset schedule agreed upon between the company and the employee, typically for between two and four years. So if a Facebook employee joined the company when it was valued at half a billion and the stock has since risen to $4 billion, the employee can buy 20 percent of their fully vested stock then turn around and sell it for an 8x return.

Also, to be clear the internal valuation applies to common stock. As I detailed in my earlier article on Facebook’s valuation, the company values its common stock at $4 billion but also values its preferred stock at $15 billion. The reason for the $15 billion preferred-stock valuation is that preferred stock holders have certain rights, including the right to sell their stock first and get their invested money back before common stockholders are allowed to sell any stock. Facebook’s preferred stockholders, such as Microsoft, also have strategic relationships with the company that are incorporated into the preferred stock valuation.

Update: Peter Kafka at Silicon Alley Insider dives into the numbers, here, and looks at how this move could impact employees. Meanwhile, Valleywag and John Furrier point to other signs of this employee stock plan in the works.

VentureBeat's mission is to be a digital town square for technical decision-makers to gain knowledge about transformative enterprise technology and transact. Discover our Briefings.