Last week, Elon Musk – the richest billionaire on the planet had a fierce joke with Mark Zuckerberg – the boss of Meta – the parent company of Facebook.
Specifically, Musk was asked about his recent offer to buy Twitter during an interview at the TED conference in Vancouver, British Columbia. The interviewer, Chris Anderson, asked Musk if his status as the richest person and one of the top influencers on Twitter could create a conflict of interest if he succeeds in taking over the social network. this association or not.
Musk took the opportunity to “talk” to Mark Zuckerberg.
“As for the thing called media ownership, you’ve got Mark Zuckerberg owning Facebook, Instagram and WhatsApp with a share ownership structure where ’14th Mark Zuckerberg’ still controls all of those companies,” Musk said. speak.
“Something like that…” Musk added amid laughter from the audience. “…will not be on Twitter”.
Musk’s statement may mean that even a very long future generation of Zuckerberg’s descendants can still own Meta with the current corporate structure.
In fact, Elon Musk’s “coffee” words are not without foundation. In 2016, the Facebook Board of Directors (which at the time had not changed its name to Meta) approved a proposal to create a class of non-voting shares (known as Class C shares) to ensure that Zuckerberg may maintain control of Facebook in the future.
This move ensures that, in the future, if Facebook uses the stock for the purpose of rewarding or paying employees or using the stock for acquisitions, Zuckerberg’s voting shares will never now “diluted”.
Additionally, if Zuckerberg wants to donate or sell his shares to charity, he can also use Class C shares, thereby maintaining his voting rights in Facebook.
The proposal also includes plans for when Zuckerberg dies, becomes disabled or leaves the company. If either of these situations occurs, the new structure will automatically convert special voting shares and non-voting shares into ordinary shares.
Since then, the company structure has changed a lot, but Mark Zuckerberg’s influence on Meta has remained the same. All thanks to the dual share structure.
The Facebook founder holds 55% of the voting shares of the company — meaning Zuckerberg essentially has complete veto power over other shareholders when it comes to the company’s future. The company has a dual-class stock structure that gives Zuckerberg, selected executives, and superior power because one of its shares is equal to 10 votes, while the other shareholders are limited. limit of one vote per share.
“No matter how many shareholders Facebook has, they will never be able to surpass Mark Zuckerberg,” said Melanie Sloan, a lawyer.
Some advocates of founder control and dual stock structures argue that it doesn’t matter when successful founders built the company from the ground up.
This time, however, the founders of other successful tech companies such as Microsoft, Alphabet, and Uber Technologies have all lagged behind. Only the person who founded Facebook 18 years ago, Zuckerberg, still controls 55% of the voting shares and remains chairman. Even Meta shareholders’ efforts to rein in Zuckerberg’s power have failed, thanks to a loyal board of directors – made up of Zuckerberg’s own top aides.
Leave a Reply