3 ms·

But having a large market cap necessarily gives a company a large amount of influence and power because they can sell stock to buy things.

• sulam 3y ago
  This is not how it works at all. Companies do not sell stock except in specific circumstances that are tightly regulated. Often they don't sell stock at all once they're public, because that increases the number of shares outstanding, causing the share value to drop, something investors generally do not like. I don't know the last time Google sold stock, but it would have been long ago because you only need to do this when you want to raise cash that you cannot get through operations, and Google has had billions of dollars in the bank for many years now.
  • mercutio2 3y ago
    Publicly traded companies create new stock, constantly, in the form of RSUs. It is true that they aren’t technically selling the stock, they’re diluting existing stock and then using the created stock as compensation, but this seems like an unimportant distinction. This does grant the company some power. Not obvious to me that power is nefarious, but it’s quite real.
    • sulam 3y ago
      The stock they use for this is not created constantly, it's created in a block set aside for that purpose by board action. Companies do this relatively infrequently.
  • HDThoreaun 3y ago
    Some companies sell stock regularly and all the big tech ones constantly use it as payment for employees.