> without the upfront capital paid by the shareholders, facebook would not exist It’s pretty debatable how much of the money they raised was critical. They nee

> without the upfront capital paid by the shareholders, facebook would not exist It’s pretty debatable how much of the money they raised was critical. They needed a bit of seed money, no question - and without regular injections of cash they would have had a much slower growth curve, for sure. They might not have been able to buy out instagram and whatsapp - but that didn’t create much value - those things existed without facebook. We might even need to account for the value that facebook’s rise took away from other firms, if we’re trying to calculate how much net value facebook’s investors have created - rather than just how much value has been enveloped into the firm - but let’s stay on point. Overall, giving money to someone starting a business, well that sounds like you’re describing a loan. A loan entitles you to get paid back, with interest. The interest is there to cover the risk that you might not get paid back. What we have instead is “ownership”, which seems to entitle you to the profits of a company’s workers in perpetuity. Numbers are a little thin, but it seems like facebook took on something like $1bil in various investments before their ipo, and raised about 16bil with their ipo (tho unclear if that 16bil went to the company, or investors + the company). Facebook has posted profits in the billions for years now. If you only count earnings since their ipo, about $173bil cumulative going to investors. At what point is the loan paid back? How much interest are they entitled to? At 9 years post investment they’ve paid back 10x what was given to them - that’s well over a 100% interest rate - and that is set to never end.