keeganpoppen parent
that is a great point. it’s one thing to occasionally rugpull employees, who are still at least paid for their services and robbed only of their EV on their options (i say “only”, though i find this increasingly common practice to be absolutely deplorable, to be clear). but how could investors possibly be happy with this becoming the new normal? will it get to the point where these sorts of faux acquisitions also involve paying out investors and only shafting employees? at that point you are only really even getting like a 20% discount over acquiring the company outright, which hardly seems worth it. which is to say that your point is very astute: the investors are definitely the linchpin here.
The company still got $20B of cash(?) in its books, it can pay dividends to its shareholders (investors) and they get their payment. The company can go down the drain afterwards. If it can still make money with its remaining assets that's only a nice small bonus.
So the only ones getting shafted are the employees.
I suppose the firm could simply roll the 20 billion into a long term asset. It’s not a big deal to anyone except employees if the asset never pays out. Departed employees would not be privy to how the money is eventually exited from the now shell company 20 years hence.
20% of 20b isn’t exactly loose change, even for a megacorp.
true, but given that recruiters take upward of 30% of first-year comp it starts to really flirt with being a wash. if the acquiree’s employees are truly that odious, the founders aren’t worth the price of admission. just look at the scale.ai guy: he is in wayyy over his head now, and if those billions mattered at all to zuck he would probably regret it, ex post.
> will it get to the point where these sorts of faux acquisitions also involve paying out investors and only shafting employees?
Yes, correct