IPO creates the “public market investment vehicle” by liquidating the assets of the private equity holders onto retail investors.
In single share class companies then, the entirety of the “value” from a financial perspective is held in stocks and corporate bonds. Whomever owns these, has voting and control rights in a way that non-voting equity holders do not.
Notably almost no public companies give voting shares to employees- I’m sure there are examples but incredibly rare.
Shareholders benefit materially from the labor of the company by holding the asset that (theoretically) accretes value with no actual labor inputs.
That means that anyone doing labor is paying the shareholders from their paycheck every month.
Why is it like this, because the contracts people sign and the egregious power disparity makes it such that capital, the voting share holders, have ALL of the value that they can turn trade or liquidate or whatever because they gave money for shares and more shares means more power in the company. The board ultimately encourages this because they are only interested in capital returns and stock price.
In single share class companies then, the entirety of the “value” from a financial perspective is held in stocks and corporate bonds. Whomever owns these, has voting and control rights in a way that non-voting equity holders do not.
Notably almost no public companies give voting shares to employees- I’m sure there are examples but incredibly rare.
Shareholders benefit materially from the labor of the company by holding the asset that (theoretically) accretes value with no actual labor inputs.
That means that anyone doing labor is paying the shareholders from their paycheck every month.
Why is it like this, because the contracts people sign and the egregious power disparity makes it such that capital, the voting share holders, have ALL of the value that they can turn trade or liquidate or whatever because they gave money for shares and more shares means more power in the company. The board ultimately encourages this because they are only interested in capital returns and stock price.