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It's a sign public equity markets aren't structured well that companies aren't encouraged to think long term. The most successful companies in today's markets d

by dangjc 8y ago

It's a sign public equity markets aren't structured well that companies aren't encouraged to think long term. The most successful companies in today's markets don't even allow common shareholders to control the company, ie Google and Facebook with their special classes of controlling shares. We might need to reconsider changing laws around choosing board seats or requiring shareholders to have minimum holding times in order to align incentives better for the long term. If public equity markets don't work, the alternative is more and more of wealth creation happening privately, in startups funded by VCs, private equity, or family owned businesses. The public won't get to participate.

stcredzero 8y ago
The public won't get to participate. It's already partly to this point. The general public can participate in a meaningful way, so long as they start to scrimp and save directly out of school.
gimmeThaBeet 8y ago
>If public equity markets don't work, the alternative is more and more of wealth creation happening privately I say that's a fair point, for the reasons you describe, that there's less oversight, and more mammoth capital sources that have an appetite for VC at nearly any stage. The "aren't encouraged to think long term" is an odd bit. You are right but at the same time it seems to be at least imo that we (the market) want these ownership structures. We want Page and Bezos and Zuckerberg and Musk, but we want to own it too. Snapchat and its S&P denial would be the battleground there. So I think to paraphrase you latter idea "we might to formalize a public equity model that is more flexible around a founder/visionary, or we might need to be more explicit about who controls a company, and what can be done to change that control." I suppose the balance to me is between making the burden of public markets lighter on companies with longer term vision, and exposing retail markets to a wild frontier that is imo only appropriate for more sophisticated parties.

by dangjc 8y ago

stcredzero 8y ago

The public won't get to participate. It's already partly to this point. The general public can participate in a meaningful way, so long as they start to scrimp and save directly out of school.

gimmeThaBeet 8y ago

>If public equity markets don't work, the alternative is more and more of wealth creation happening privately I say that's a fair point, for the reasons you describe, that there's less oversight, and more mammoth capital sources that have an appetite for VC at nearly any stage. The "aren't encouraged to think long term" is an odd bit. You are right but at the same time it seems to be at least imo that we (the market) want these ownership structures. We want Page and Bezos and Zuckerberg and Musk, but we want to own it too. Snapchat and its S&P denial would be the battleground there. So I think to paraphrase you latter idea "we might to formalize a public equity model that is more flexible around a founder/visionary, or we might need to be more explicit about who controls a company, and what can be done to change that control." I suppose the balance to me is between making the burden of public markets lighter on companies with longer term vision, and exposing retail markets to a wild frontier that is imo only appropriate for more sophisticated parties.