Tag: Supervoting Stock

@dseetharaman & @emilyglazer: Mark Zuckerberg Asserts Control of Facebook, Pushing Aside Dissenters

[Editor Charlie sez:  If you don’t know about the supervising stock that allows Zuckerberg, Page & Brin & Schmidt to control vast tech companies, read Chris Castle’s op-ed in the NY Post “The best way to hit back at Silicon Valley power: End supervoting stock held by insiders“]

In December, Facebook Inc.’s top brass gathered at Mark Zuckerberg’s more than 700-acre, beachfront estate in Kauai, Hawaii, for an unusual board meeting to discuss how to redirect the company after years of turmoil.

Changes came, but they weren’t what everyone expected, according to people familiar with the gathering.

Within months, Facebook announced the departure of two directors, and added a longtime friend of Mr. Zuckerberg’s to the board. The moves were the culmination of the chief executive’s campaign over the past two years to consolidate decision-making at the company he co-founded 16 years ago. The 35-year-old tycoon also jumped into action steering Facebook into a high-profile campaign in the coronavirus response, while putting himself in the spotlight interviewing prominent health officials and politicians.

The result is a Facebook CEO and chairman more actively and visibly in charge than he has been in years.

Read the post on the Wall Street Journal

@musictechpolicy: The best way to hit back at Silicon Valley power: End supervoting stock held by insiders via @NYDailyNews

The meltdown of WeWork’s CEO and Mark Zuckerberg’s bizarre threat to sue the U.S. offer a teachable moment: When you concentrate vast and unaccountable control over major companies in founders — no matter how creative or capable — bad things happen.

In Silicon Valley, the problem starts with “supervoting” stock structures that let the CEO (mostly) boy wonders raise mountains of cash from star-struck investors without giving up meaningful control over the company. The trick is a gimmicky “dual-share” stock structure in which the insiders’ own shares have powerful voting rights but ordinary investors are stuck on the sidelines. SEC Commissioner Robert Jackson has warned this dual class in effect creates “corporate royalty.”George Orwell would probably say it’s just another example of the “Some Animals Are More Equal Than Others” corruption that eventually poisons pretty much every revolution.

Read the post on New York Daily News