Using Power as a Founder
Over the past few days a "scandal" has emerged from a leaked email regarding AirBnB's new round of financing.
Potential investor Chamath Palihapitiya (former head of growth at Facebook and now increasingly prolific investor), penned an email detailing his reasons for passing on the deal. Namely, that ~$22M of the new funds were being used to pay out a dividend to shareholders (93% of which appears to be the founders). This is an extremely unorthodox method for providing founder liquidity.
Over the last several years, founders have seen their power rise in comparison with investors. This is driven by both short-term realities (e.g. the relative stability of the technology market bringing in new investors) and long-term trends (costs decreasing exponentially and growth of user bases and addressable market sizes).
One can argue whether this power balance is good or not, but I'd rather just accept that it's happening (this fact is elegantly defended by Naval Ravikant; Paul Graham has written about it as well). If the power balance is shifting, we will likely see frequent examples of the impressive companies testing the boundaries of how they can apply this power in negotiations.
Ultimately this is just a sensational example of rational actors in a market trying to discover a new equilibrium.
However, it does open up an interesting question: how should founders wield this new, unknown power?
If you're leading a high-growth company, think about what boundaries you want to test and how you want to go about optimizing for greatest possible impact/outcome. Fight for the things that will matter in the long-term for both you and your team (control, rights, ability to maintain simplicity/speed, comfort, etc.).
Going after short-term gain can be logical, and is not inherently wrong, but every time you do so it becomes easier to slip into playing a short-term game. If you make that slip, you will dilute your chances to actually disrupt or create a market.
Some food for thought: If they'd been in this current market during their ascent, would Bezos try to get a dividend payout? Zuck? Page or Brin? Gates? Jobs? My guess is yes, probably one of them would have tried it - which is why you shouldn't use this as a way to fault the AirBnB team, regardless of whether you like the idea of a dividend cash-out.
A federal judge ruled that the Trump administration likely violated the reporter's Fifth Amendment rights when it stripped his press credentials earlier this month.
- Acosta will be allowed to return to the White House on Friday.
- The judge described the ruling as narrow, and didn't rule one way or the other on violations of the First Amendment.
- The case is still open, and the administration may choose to appeal the ruling.
Progressive America would be half as big, but twice as populated as its conservative twin.
- America's two political tribes have consolidated into 'red' and 'blue' nations, with seemingly irreconcilable differences.
- Perhaps the best way to stop the infighting is to go for a divorce and give the two nations a country each
- Based on the UN's partition plan for Israel/Palestine, this proposal provides territorial contiguity and sea access to both 'red' and 'blue' America
The definition of a kilogram will now be fixed to Planck's constant, a fundamental part of quantum physics.
- The new definition of a kilogram is based on a physical constant in quantum physics.
- Unlike the current definition of a kilogram, this measurement will never change.
- Scientists also voted to update the definitions of several other measurements in physics.
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