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Bezos, Gates, Musk, Buffer have their fortunes tied up in the operational reality of their companies. Gates and Buffet have committed to giving away almost ever

Bezos, Gates, Musk, Buffer have their fortunes tied up in the operational reality of their companies. Gates and Buffet have committed to giving away almost everything, and at least for now, frankly, it's probably better for all of us that Musk keeps plowing into Musk projects. Mackenzies money is essentially her bank account, which is a very different thing. It's not a condemnation, but I think an important contextualization.

sumedh 5y ago
> Mackenzies money is essentially her bank account, Isnt that "money" in Amazon stock, just like Buffett and Gates whose "money" is in stocks of various companies.
bongoman37 5y ago
Not true for Gates.
ivalm 5y ago
Mackenzie’s money is as tied or not to operational realities as Jeff’s, as their fortunes are in the form of Amazon stock. Both of them are capable of saying “I am selling X shares to give to philanthropy” except only one of them does it.
- eftychis 5y ago
  There is the reality of wanting to keep control of your company. I can't guess Bezos' reasoning and philanthropy beyond that -- I don't have access to his taxes to state if he gives some amount secretly or not. I would be more surprised than you if he doesn't give anything as there is a substantial tax incentive. But a lot of people give away or become art benefactors in the U.S. because taxes. At the end of the day, I would suggest we don't wait for anyone to feel bad about us to give us philanthropy. If they do great, but if they don't we should take care of our society's kids.
  - onion2k 5y ago
    There is the reality of wanting to keep control of your company. Jeff owns about 10% of Amazon in shares that have ordinary voting rights. He stood down as CEO a little while ago. Retaining control is not the reason, because he doesn't have control.
    - eftychis 5y ago
      Sure. He is still the executive chair of the board and the largest stakeholder. There are different type of board members in companies -- some are "independent" -- essentially free floating and attaching their vote to the "top dog." There was even a top article on hacker news describing how to keep track of your board and what the board does really. https://www.investopedia.com/articles/insights/052816/top-4-amazon-shareholders-amzn.asp https://www.investopedia.com/articles/insights/052816/top-4-... If you read the summary above, you will note that as part of the settlement Bezos kept the voting rights of their communal stock, she got the ownership of 25% of that stock which was 4% of total. Why do that if it doesn't matter? Note there are only three insiders on the board and only Bezos has above 1%. She could have gotten a board seat if she wanted to I guess -- although things would probably be "interesting." P.S. If one had a dirty mind, and depending how the contract was written, one could say Scott was selling the stock to remove votes from Bezos. Otherwise, the efficient way would be to borrow money against your stock, sell some later perhaps to cover the low to no interest rate you would get etc. Generally at these scales you only sell stock to diversify, income taxes(rsus/options), or cover interest (and usually not even for that). (Imagine 4% of the Amazon stock up for sale in a matter of weeks.)
      - ivalm 5y ago
        On average ~0.5% of amzn trades every day, with some days going up to 1.5%. 4% in a matter of weeks is honestly not going to have too major of impact.
        eftychis 5y ago
        These are not additive however. If you are a daytrader for instance you will buy and sell, say amazon, multiple times in a week, and will clear your portfolio over the weekend or holidays etc. If you do statistical arbitrage/mispricing you keep for weeks usually and you have to account for slippage. (You always have to account for slippage.) So a 0.5% trading back and forth trying to converge on a price and meet some new demand either way is stable state and it can involve the same players (buyers/sellers incl. market makers). Now imagine if the market suddenly demands an extra 5-10 billion of dollars per week on top of the existing stable demand. The money has to be introduced in the market somehow. It means that for me it must be worth it more to buy amazon over something else in my investing horizon. And even with margin I expect this is going to raise the collateral the clearing houses would require. Now also imagine a SEC entry (form 4) stating that 4% is dropping on the market. A recent example is Elon Musk with Tesla and he tricked people into thinking it was their choice and to my knowledge he still has not sold that whole 10% of his position.(Not 10% of the company...)
- Aunche 5y ago
  Mackenzie has the time to be a full time philanthropist. Despite retiring as CEO of Amazon, Jeff is still playing an active role in Amazon and Blue Origin.
  - ivalm 5y ago
    That may be true but wasn’t the point discussed. Grandop suggested other billionaire fortunes are “tied down” while Mackinzie’s was liquid. This is false.
  - jacquesm 5y ago
    Blue Origin is a hobby.
- skybrian 5y ago
  Well, he is doing it somewhat: > Bezos’ known charitable gifts, totaling more than $13 billion, would rank him among the biggest donors ever. Except all but about $1.5 billion of that sum are pledges of future money—meaning he hasn’t given the cash away yet. Meanwhile, another major Amazon stockholder is giving away a greater percentage of her fortune, and doing it much faster: Bezos’ ex-wife, MacKenzie Scott. More details: https://www.forbes.com/sites/lisettevoytko/2021/07/22/how-jeff-bezos-philanthropy-compares-to-ex-wife-mackenzie-scotts/ https://www.forbes.com/sites/lisettevoytko/2021/07/22/how-je...
- jollybean 5y ago
  No, this is not true. Bezos needs to maintain a huge an material % ownership of his company in order to maintain control - and - it's something investors will expect. Mackenzie could care less about influence over Amazon. If the stock markets would allow transactions at that scale without distortion, she could feasibly trade all of her AMZN for some other kind of portfolio and it would be just the same to her. Completely different situations. And the same thing applies to almost all Founder/CEOs until they retire, and then for some period afterwards.
  - ivalm 5y ago
    Except Jeff’s voting power is tied to Mackinzie’s holding of $AMZN as he retained voting rights (until she sells). The transaction itself is small relative to overall volume.
  - wumpus 5y ago
    At some point Jeff might rue the agreement that he votes her shares.
skybrian 5y ago
The situation for Gates seems similar? He’s no longer CEO or on the board of directors of Microsoft, and isn’t the largest shareholder either, having donated stock to the Bill and Melinda Gates Foundation. Based on the article, they are giving money away at a somewhat slower rate. But maybe for longer?
- jollybean 5y ago
  Gates started selling off large portions of MSFT a long time ago, but at a very controlled and planned rate. Investors do not like to see serindipitous transactions at that scale, from post-Founders who are still effectively 'Godheads' even if they are not in control. Just like coupon payments or stock dividends, what matters is the consistency. So they signal well in advance, offer a structured plan, and then sell of $X every year, which goes into Gates Foundation etc.. It's 100% the purview of these mega donors to enshrine some kind of vision for their funds, which may last a long time, if not generations. They make take the view that they will invest 100% of the money into a charity fund, and the returns from that fund get distributed. I don't think there is really any specific merit in 'how quickly you give your money away'. Mackenzie was 'one degree removed' from Amazon as it was built, she probably feels less attached to it, and maybe she just wants to push it out the door now, that's fine, good on her, but I don't think it means anything really.
TYPE_FASTER 5y ago
billg has sold the majority of his Microsoft stake over the years. He owned 24% of MSFT in 1996, and as of 2017 owned 1.3%.

sumedh 5y ago

> Mackenzies money is essentially her bank account, Isnt that "money" in Amazon stock, just like Buffett and Gates whose "money" is in stocks of various companies.

bongoman37 5y ago

Not true for Gates.

ivalm 5y ago

Mackenzie’s money is as tied or not to operational realities as Jeff’s, as their fortunes are in the form of Amazon stock. Both of them are capable of saying “I am selling X shares to give to philanthropy” except only one of them does it.

eftychis 5y ago
There is the reality of wanting to keep control of your company. I can't guess Bezos' reasoning and philanthropy beyond that -- I don't have access to his taxes to state if he gives some amount secretly or not. I would be more surprised than you if he doesn't give anything as there is a substantial tax incentive. But a lot of people give away or become art benefactors in the U.S. because taxes. At the end of the day, I would suggest we don't wait for anyone to feel bad about us to give us philanthropy. If they do great, but if they don't we should take care of our society's kids.
- onion2k 5y ago
  There is the reality of wanting to keep control of your company. Jeff owns about 10% of Amazon in shares that have ordinary voting rights. He stood down as CEO a little while ago. Retaining control is not the reason, because he doesn't have control.
  - eftychis 5y ago
    Sure. He is still the executive chair of the board and the largest stakeholder. There are different type of board members in companies -- some are "independent" -- essentially free floating and attaching their vote to the "top dog." There was even a top article on hacker news describing how to keep track of your board and what the board does really. https://www.investopedia.com/articles/insights/052816/top-4-amazon-shareholders-amzn.asp https://www.investopedia.com/articles/insights/052816/top-4-... If you read the summary above, you will note that as part of the settlement Bezos kept the voting rights of their communal stock, she got the ownership of 25% of that stock which was 4% of total. Why do that if it doesn't matter? Note there are only three insiders on the board and only Bezos has above 1%. She could have gotten a board seat if she wanted to I guess -- although things would probably be "interesting." P.S. If one had a dirty mind, and depending how the contract was written, one could say Scott was selling the stock to remove votes from Bezos. Otherwise, the efficient way would be to borrow money against your stock, sell some later perhaps to cover the low to no interest rate you would get etc. Generally at these scales you only sell stock to diversify, income taxes(rsus/options), or cover interest (and usually not even for that). (Imagine 4% of the Amazon stock up for sale in a matter of weeks.)
    - ivalm 5y ago
      On average ~0.5% of amzn trades every day, with some days going up to 1.5%. 4% in a matter of weeks is honestly not going to have too major of impact.
      - eftychis 5y ago
        These are not additive however. If you are a daytrader for instance you will buy and sell, say amazon, multiple times in a week, and will clear your portfolio over the weekend or holidays etc. If you do statistical arbitrage/mispricing you keep for weeks usually and you have to account for slippage. (You always have to account for slippage.) So a 0.5% trading back and forth trying to converge on a price and meet some new demand either way is stable state and it can involve the same players (buyers/sellers incl. market makers). Now imagine if the market suddenly demands an extra 5-10 billion of dollars per week on top of the existing stable demand. The money has to be introduced in the market somehow. It means that for me it must be worth it more to buy amazon over something else in my investing horizon. And even with margin I expect this is going to raise the collateral the clearing houses would require. Now also imagine a SEC entry (form 4) stating that 4% is dropping on the market. A recent example is Elon Musk with Tesla and he tricked people into thinking it was their choice and to my knowledge he still has not sold that whole 10% of his position.(Not 10% of the company...)
Aunche 5y ago
Mackenzie has the time to be a full time philanthropist. Despite retiring as CEO of Amazon, Jeff is still playing an active role in Amazon and Blue Origin.
- ivalm 5y ago
  That may be true but wasn’t the point discussed. Grandop suggested other billionaire fortunes are “tied down” while Mackinzie’s was liquid. This is false.
- jacquesm 5y ago
  Blue Origin is a hobby.
skybrian 5y ago
Well, he is doing it somewhat: > Bezos’ known charitable gifts, totaling more than $13 billion, would rank him among the biggest donors ever. Except all but about $1.5 billion of that sum are pledges of future money—meaning he hasn’t given the cash away yet. Meanwhile, another major Amazon stockholder is giving away a greater percentage of her fortune, and doing it much faster: Bezos’ ex-wife, MacKenzie Scott. More details: https://www.forbes.com/sites/lisettevoytko/2021/07/22/how-jeff-bezos-philanthropy-compares-to-ex-wife-mackenzie-scotts/ https://www.forbes.com/sites/lisettevoytko/2021/07/22/how-je...
jollybean 5y ago
No, this is not true. Bezos needs to maintain a huge an material % ownership of his company in order to maintain control - and - it's something investors will expect. Mackenzie could care less about influence over Amazon. If the stock markets would allow transactions at that scale without distortion, she could feasibly trade all of her AMZN for some other kind of portfolio and it would be just the same to her. Completely different situations. And the same thing applies to almost all Founder/CEOs until they retire, and then for some period afterwards.
- ivalm 5y ago
  Except Jeff’s voting power is tied to Mackinzie’s holding of $AMZN as he retained voting rights (until she sells). The transaction itself is small relative to overall volume.
- wumpus 5y ago
  At some point Jeff might rue the agreement that he votes her shares.

skybrian 5y ago

The situation for Gates seems similar? He’s no longer CEO or on the board of directors of Microsoft, and isn’t the largest shareholder either, having donated stock to the Bill and Melinda Gates Foundation. Based on the article, they are giving money away at a somewhat slower rate. But maybe for longer?

jollybean 5y ago
Gates started selling off large portions of MSFT a long time ago, but at a very controlled and planned rate. Investors do not like to see serindipitous transactions at that scale, from post-Founders who are still effectively 'Godheads' even if they are not in control. Just like coupon payments or stock dividends, what matters is the consistency. So they signal well in advance, offer a structured plan, and then sell of $X every year, which goes into Gates Foundation etc.. It's 100% the purview of these mega donors to enshrine some kind of vision for their funds, which may last a long time, if not generations. They make take the view that they will invest 100% of the money into a charity fund, and the returns from that fund get distributed. I don't think there is really any specific merit in 'how quickly you give your money away'. Mackenzie was 'one degree removed' from Amazon as it was built, she probably feels less attached to it, and maybe she just wants to push it out the door now, that's fine, good on her, but I don't think it means anything really.

TYPE_FASTER 5y ago

billg has sold the majority of his Microsoft stake over the years. He owned 24% of MSFT in 1996, and as of 2017 owned 1.3%.