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0 pointsgonehome5y ago0 comments

I think a wealth tax is a bad idea (as described in my comment above), but you can structure equity so that you retain control even without a large holding of shares (see: Palantir, Facebook).

Arguably a wealth tax would create an incentive for everyone to do this which I would argue is probably bad since then the company controllers have less skin in the game.

Generally I think a wealth tax creates a ton of these perverse incentives with little true upside.

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mac010215y ago

> you can structure equity so that you retain control even without a large holding of shares (see: Palantir, Facebook).

I'm a little confused about this though. If class A shares have all the votes (while most shares are class B shares), what prevents the market from valuing the class A shares at an extremely high value and the class B shares not at all? When the company finally gets big and stops growing, the source of its value to shareholders will be the dividends that it pays and it will be the voting class A shareholders that decide how dividends are allocated.

gonehomeOP5y ago

There’s typically a rule that the shares with extra voting power cannot be sold. They automatically convert prior to sale.

Basically they’ve thought of these things and controlled for them already.

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