3 ms·
Just your usual "all shares are equal but some shares are more equal than others" dual stock structure that is in vogue these days: Google, Zynga (ahem) and a n
by sireat 7y ago
Just your usual "all shares are equal but some shares are more equal than others" dual stock structure that is in vogue these days: Google, Zynga (ahem) and a number of other companies have them.
It still boggles the mind that the investors place such a small premium on the right to vote.
I am trying to see how one could defend this type of structure.
It is the ultimate "having your cake and eating it" deal for the founder.
MZ could build a giant money hole with FB money in Antarctica and there is nothing shareholders could do.
- skewart 7y agoGiving the founder control prevents other investors from taking control of the company and doing things that are worse than what the founder would do.
- sireat 7y agoThis would be perfectly fine if founder keeps 51% of shares. It should not be possible to have it both ways as a founder: own minority of shares and yet keep the control. You want full control? Then do not dilute yourself. It used to be normal for the founder(s) to have the most (but not the majority) of the shares. See Gates/Allen at Microsoft. This meant that usually shareholder vote went their way, but there was a possibility that you could get ousted. See Jobs at Apple circa 1985. It should not be possible to be the absolute king of a publicly owned company while owning less than 50% of a company.