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Minority equity in a company means nothing. Let's vote on the $20mil bonus to the CEO or distribute it amongst the owners of the company. Oh, the CEO (and maj
by LanceH 5y ago
Minority equity in a company means nothing.
Let's vote on the $20mil bonus to the CEO or distribute it amongst the owners of the company. Oh, the CEO (and majority owner) gets it all.
- 55555 5y agoDividends are taxed at a lower rate than salary and other forms of ordinary income. If a company has surplus money, it should eventually be remitted to the equity holders as dividends. I guess it doesn't need to be, though.
- MichaelZuo 5y agoUnless the CEO literally owns >50% I don’t see how it means ‘nothing’. Voting blocs come and go I imagine, that’s definitely something.
- ab_testing 5y agoAlmost all equity given to employees is a totally different class of shares than held by the founders.
- jacobr1 5y agoEmployee options pools tend to be maintained at 10-15% of the company. Unless you are a cofounder, very-early employee, or recruited-big-exec in a growth phase, your equity, AND importantly, ALL the equity from your employee peers sums to less than whatever the VCs+Founders want. Ideally your interests are aligned, and any gain they get your share-in (albeit in a much smaller amount). But things like preferred shares getting liquidation preferences screw with this calculous, as to differing investment horizons.
- MichaelZuo 5y agoWhen any of the above mentioned have disagreements, won’t they try to recruit support from the remaining shareholders?
- nextlevelwizard 5y agoWhat company gives out >50% of their company to their employees?