This archive report was first published on 27 November 2019.
Published on November 27, 2019, a dual-class stock structure has become a common practice in the tech industry, allowing founders and executives to maintain control over their companies.
While this arrangement may seem beneficial in the short term, allowing founders to focus on long-term growth and innovation, it can have significant drawbacks, including lower stock returns and higher executive compensation.
Perpetual dual-class stock, in particular, gives founders and their families voting power that can last forever, effectively shielding them from accountability and criticism.
As the use of dual-class stock structures has become more widespread, particularly in the tech industry, it has raised concerns about the concentration of power and the potential for abuse.
Some argue that this arrangement is necessary to protect founders and their vision, but others see it as a way for executives to maintain their grip on power and avoid accountability.
