>The plaintiffs suing Facebook's board include pension funds, like the Employee Retirement System for the city of Providence, Rhode Island, and individual investors
It may be "founder-friendly", but it's hurting thousands of Average Joes.
So it appears pretty clear that there's a bigger career game being played here, and it isn't even strictly about stock.
Apply your line of thought to democracy and you'll see what's the problem.
If you want an accurate government analogy, look at the military: it has to move fast to succeed. You only run a war by committee if you want to lose.
Go radically against these and chaos will erupt. It's both unintelligent and ideological to take speed as an absolute.
Actually no. As recently as Burwell v Hobby Lobby, the Supreme Court said:
"Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not."
For example, if you're trying to maximize cash on hand in the very short term, you simply stop paying your bills and declare bankruptcy when creditors attack. But if your goals are further out, this becomes the exact wrong strategy. Whatever your goal may be, you need a time frame to determine what is and isn't a good use of resources in realizing it.
Conversely, anyone who says "maximize shareholder value" without specifying a time frame is either a fool or a grifter. You can imagine how well things go when these types get together and "agree" on something this dangerously unbounded as a fundamental operating principle.
Probably a one time thing they don't have to worry about too much. But do that a couple of times, and they might start to have problems finding co-investors on bigger deals if the perception is that the investors won't hang together as a class.
Wouldn't it be a bad signal that this person, if on your board, might pull a similar thing but to your detriment?
Say if FB wanted to acquire you, would he take your side or MZ's? Would he give you advice that was beneficial to MZ but detrimental to your company?
To be clear I'm not saying MA is actually guilty as the lawsuit alleges, but I'm assuming the facts are true since your conclusion relies on the same premise.
Is that like corrupt bankers being "shareholder" friendly, or "executive-team" friendly? It's okay as long as you get yours.
We don't know. It does not say either way.
in this case, being founder friendly is at odds with looking out for minority shareholders.
I'm going to be blunt but when was the last time a16z had a hit on their hands?
Help me understand the branding value of a16z because I didn't get any of that vibe from the article. Also most founders aren't multi-billionaires to boot, so I don't see the connect.
1) The article highlights that a16z is founder-friendly.
2) The lawsuit alleges that Andreessen acted against the behalf of shareholders that he has a legal obligation to protect.
Part of the thesis that a16z operates under is that great companies keep their founders as CEOs longer and more often than non-great companies. So on the surface being founder-friendly doesn't have to imply a legal conflict. The argument that the lawsuit rests on is that common shareholders would be better off (had a high price) if Zuckerberg lost his special voting rights. In the end it's a moot point. If the board wouldn't let him do it, he would have postponed the charitable foundation.
Instead, he sent a crib sheet to Zuck, scripted potential responses to questions so Zuck "knew what they wanted to hear", and even texted him in the board meetings to provide live coaching.
There's no way that this is not a bad move.
But asking for this friendly help would also be a violation of the law and in general, not a very ethical thing to do.