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Meta “will have a 49% stake in the artificial intelligence startup, but will not have any voting power” Wouldn’t Scale’s board/execs still have a fiduciary dut
by rlt 1y ago
Meta “will have a 49% stake in the artificial intelligence startup, but will not have any voting power”
Wouldn’t Scale’s board/execs still have a fiduciary duty to existing shareholders, not just Meta?
- delusional 1y agoYes, but Meta would be able to kick the board and find another one more willing to accept their proposal as the best for shareholders.
- unshavedyak 1y agoPower struggles like this are weird to me. Is kicking the board likely to succeed at 49%? If so it feels like the control percentage isn't the primary factor in actual control.
- pixl97 1y agoYou only need to convince 2% of the other stakeholders to get your way.
- rlt 1y agoThey don’t have voting power.
- flyinglizard 1y agoAt 49% I'm certain they would become the largest shareholder, by far. Then allying with another smaller shareholder to get majority - especially as you are Meta and can repay in various ways - is trivial. This is control, in all forms but name.
- tyre 1y agoanother shareholder, one of the largest, is the now-former-CEO who now works at Meta. They have full control.
- delusional 1y agoThere's a lot of things shareholders can do to screw over other shareholders. Smaller shareholders are at least somewhat likely to follow along with the largest shareholder, just to avoid becoming their enemies and getting squeezed out.
- mbesto 1y agoThe prevailing theory is that Meta did a 49% deal so it didn't set off anti-trust alarm bells. In other words, the 49% doesn't give them ultimate power, but you can best believe when Meta tells them to jump, the board and the execs are going to ask "how high?".