You’ll probably see coverage on some radical moves that Mark Zuckerberg has made at Facebook–and let’s focus on the grammar of that sentence. One person has essentially fired or replaced everyone in the senior leadership of a public company who disagreed with him. He’s not letting a good crisis go to waste. Here’s the ins and outs of people spending more or less time with family:
Zuckerberg “friend” Chris Cox–steps down.
Former Amex CEO Kenneth Chenault–gone.
Obama advisor Jeffrey D. Zients–gone.
Netflix Inc. CEO Reed Hastings–gone.
Clinton White House Chief of Staff Erskine Bowles–gone.
Independent director Susan Desmond-Hellmann–gone.
Dropbox CEO Drew Houston and Zuck crony–in.
PayPal’s Peggy Alford (former CFO of Chan Zuckerberg Initiative)–in.
Mark Andreessen–thin ice.
Sheryl Sandberg–leaning with the wind.
These are big changes and they are being initiated by one–one–person at what is arguably the most influential media company in the world. It must be said that Facebook’s market cap is greater than the nominal GDP of a dozen or more countries. It also must be said that Facebook, by the way, is still largely unlicensed and definitely incapable of rendering anything like a normal royalty statement because it has no way to track music on its network because it just doesn’t care.
So when you read the news about these moves here’s the buried lede, the dog that didn’t bark. Just like the CCP actually controls Alibaba and Tencent (albeit for different reasons), Zuckerberg can make all these changes because he has supervoting stock. MTP readers will recall that we have spilled a fair amount of ink on this subject, and I also wrote an op-ed for the NY Daily News on the subject.
In late 2013, before Facebook joined the S&P 500, Zuckerberg exercised an option to buy 60 million supervoting Facebook shares, making his stranglehold on the company essentially permanent. Rani Molla writing in Recode about WeWork, another supervoting catastrophe, called it “a warning sign for the rest of the technology industry about what can happen when a company’s power is concentrated among too few people.”
Strangely, there is lots of coverage about what Zuckerberg has done, but no discussion I have found about how he did it. And that is the dog that did not bark.
You may see references to the board changes being confirmed by a shareholder vote–which will be the least suspenseful event in recent history given that Zuckerberg’s supervoting shares give him the power to trump any shareholder bloc assembled against his wishes. When you consider Facebook’s disregard for the nation state as a trivial impediment, it all becomes clear.
Or in the words of Louis XIV, l’état, c’est moi.