Comment by 0xDEAFBEAD
2 days ago
Consider also that VC funds often have pension funds as their limited partners. Workers have a claim to their pension, and thus a claim to the startup returns that the VC invests in.
So yeah it basically comes down to your definition of "worker-owned". What fraction of worker ownership is necessary? Do C-level execs count as workers? Can it be "worker-owned" if the "workers" are people working elsewhere?
Beyond the "worker-owned" terminology, why is this distinction supposed to matter exactly? Supposing there was an SV startup that was relatively generous with equity compensation, so over 50% of equity is owned by non-C-level employees. What would you expect to change, if anything, if that threshold was passed?
> Supposing there was an SV startup that was relatively generous with equity compensation, so over 50% of equity is owned by non-C-level employees. What would you expect to change, if anything, if that threshold was passed?
If the workers are majority owners, then they can, for example, fire a CEO that is leading the company in the wrong direction, or trying to cut their salaries, or anything like that.
>If the workers are majority owners, then they can, for example, fire a CEO that is leading the company in the wrong direction, or trying to cut their salaries, or anything like that.
Why wouldn't the board fire said CEO?
The most common reason to cut salaries is if the company is in dire financial straits regardless. Co-ops are more likely to cut salary and less likely to do layoffs.
Because the board doesn't understand the business at the level that employees do. Or because the board has different goals for the business than employees do. Or because the board is filled with friends of the CEO who let them do whatever.
Also, lots of companies reduce salaries or headcount if they feel they can get away with it. They don't need to be in dire financial straights, it's enough to have a few quarters of no or low growth and to want to show a positive change.
It’s not “your definition”. Worker owned means the workers own the means of production. What you’re talking about is not that at all.
What changes is democracy in the work place.
You are confusing owning minority equity with what actual control gives you —- actual ownership of capital/MoP/assets/profits
How specifically would you expect a typical SV corp's policies to change if employee equity passes from 49% to 51%?
Remember, if employees own 49%, if they can persuade just 2% of the other shareholders that a change will be positive for the business, they can make that change. So minority vs majority is not as significant as it may seem.