Opinion

The Great Debate

from Breakingviews:

Solving the second-class stock dilemma

By Rob Cox

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

Over dinner in San Francisco recently, an activist investor and an internet entrepreneur got into a heated discussion. The two men, with a gap of about two decades between them, were debating the practice of many young, growth businesses in the technology world – though it happens elsewhere too – to issue multiple classes of stock, generally one for hoi polloi investors in public offerings and another for founders and other insiders with super-charged voting powers.

This, the investor felt, violates a tenet of democratic capitalism: “one share, one vote.” It treats public shareholders of Silicon Valley’s hottest properties as second-class citizens. Not so, argued the information industrialist, now working in his second mega-startup. Visionaries need to build their businesses without the distraction of having to please uppity investors every quarter. Giving them control of their boards of directors and key corporate decisions is vital.

The protagonists sort of agreed to disagree. Investors don’t have to buy shares if they don’t like the voting arrangements – though some might say that companies often don’t have to seek money from public investors, either.

But surely there is a way to square this circle. What if a mechanism could be created that would allow founders like Facebook’s Mark Zuckerberg or GoPro’s Nicholas Woodman to execute their plans for global domination, leavened with promises to make the world more awesome, without pesky shareholder interference – but also preserving in the long term the one share, one vote concept?

from Breakingviews:

Solving the second-class stock dilemma

By Rob Cox

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

Over dinner in San Francisco recently, an activist investor and an internet entrepreneur got into a heated discussion. The two men, with a gap of about two decades between them, were debating the practice of many young, growth businesses in the technology world – though it happens elsewhere too – to issue multiple classes of stock, generally one for hoi polloi investors in public offerings and another for founders and other insiders with super-charged voting powers.

This, the investor felt, violates a tenet of democratic capitalism: “one share, one vote.” It treats public shareholders of Silicon Valley’s hottest properties as second-class citizens. Not so, argued the information industrialist, now working in his second mega-startup. Visionaries need to build their businesses without the distraction of having to please uppity investors every quarter. Giving them control of their boards of directors and key corporate decisions is vital.

How technology widens the gender gap

The Internet and mobile phones have transformed our connections to people around the world. This technology has also, however, led to a widening gender gap in poorer countries. For it is largely men who control the information revolution that helps to educate, inform and empower.

In low and middle-income countries, a woman is 21 percent less likely than a man to own a mobile phone, according to research done by GSMA. In Africa, women are 23 percent less likely than a man to own a cell phone. In the Middle East the figure is 24 percent and in South Asia, 37 percent,

The factors driving women’s lack of connectivity vary from community to community. But the end result is always the same: disempowerment.

The missing ingredient for middle-class jobs

Christopher “Topher” Polack began his Apple career as a “creative genius.” He thrived in his job fixing customers’ technology problems and quickly rose through the ranks, getting more on-the-job training along the way. But like most other members of his genius class, he eventually quit. He now works as a freelance consultant specializing in helping older people use technology.

“I wasn’t meant to be a cog,” says Polack, who increased his salary post-Apple.

Polack’s experience provides a blueprint for how to thrive in the modern labor market and points to the future of middle-class jobs. Unlike the industrial revolution, the latest technology revolution diminishes the value of long-term employment relationships and places a premium on individual skills. Workers like Polack are more mobile and take the skills they acquire from one job to the next. Yet America’s institutions haven’t fully adapted, and may be holding the economy back.

Let free markets and technology reduce gun violence

Ron Conway, an angel investor in some of the most successful startups of the past decade, from Google to Twitter, was holding a Christmas party in his San Francisco apartment overlooking the Golden Gate Bridge on Dec. 14. One of his guests that evening was former Congresswoman Gabby Giffords.

What was supposed to be a festive occasion turned solemn as Conway convened a prayer for the families of Newtown, CT and exhorted the leading lights of technology and venture capital gathered in his home to ingeniously help tackle the problem of gun violence.

There may be a lot of problems that deep pockets and tech startup ingenuity can’t help solve, but the epidemic of senseless mass shootings needn’t be one of them.

The next generation demands sustainable, innovative business

Christina Marule owns a spaza shop — the equivalent of a corner store — in rural South Africa. Five years ago she was forced to keep her young son out of school while she traveled to the nearest market, a half day’s trip away, to purchase products to sell in her store. Today, she manages inventory via text message from a mobile device. Her son is back in the classroom.

Her story is one of personal determination, but also of real progress.

Fueled by innovation and the determined ambition of a whole new generation, stories like this are transforming business models and entire value chains. To the world’s future leaders, sustainable behavior is as much about educating Christina’s son as it is about protecting the world’s supply of drinkable water. It’s up to today’s leaders to connect those dots.

In a recent survey 84 percent of Millennials (the generation born between 1980 and 1993) said they care more about making a positive difference than workplace recognition. These young professionals are the very same consumers who care more about purpose than packaging or price. They are concerned, creative and impatient for opportunities to make a difference. Their terms are crystal clear: innovate business models around making the world run better and improving people’s lives — or be left behind by those that do.

Apple: ‘Early adopter’ as fashionista

To much fanfare, Apple announced Tuesday that Angela Ahrendts is resigning as chief executive officer of Burberry and joining the inner circle in Cupertino, California. “Apple-polishing” has become the headline du jour. Picturing the soignée Ahrendts surrounded by geeks in jeans and hoodies, we might be forgiven for wondering why Apple feels in need of a fashionista buff-up. After all, there is hardly a product line more shiny-bright than Apple’s — or one with less affinity to the cold exclusivity of the world’s great fashion houses.

But the extraordinary affection that iPhones inspire is different from the anxious ostentation surrounding high fashion.

However sublime couture may be, it is neither lovable nor practical. Nor does using it feel like participating in a major human advance. There is something wondrous about Apple products in the ease and pleasure they afford their users, connecting us in unprecedented ways to other people, to our surroundings and to the world of ideas.

from The Great Debate UK:

Science’s innovators are to be prized

--Juha Ylä-Jääski (D.Tech.) is President and CEO of Technology Academy Finland. The opinions expressed are his own.--

The 2013 Nobel season is once again gorging on a Grand Cru vintage of scientific achievement. Today, the Nobel Prize for Chemistry was awarded to three scientists, Levitt, Karplus and Warshel, whose multinational collaboration laid the foundation for the computer models crucial for most advances in chemistry today. Yesterday, Peter Higgs and Francois Englert won the Nobel Prize for physics for conceiving the so-called "God particle" which explains why the Universe has mass. Another trio were recognised on Monday when the Nobel Prize in physiology or medicine was awarded to Rothman, Schekman and Südhof for solving the mystery of how the cell transports crucial cargo.

The Nobel Prize once stood alone commanding the attention of the world’s media.  Though it remains pre-eminent, as shown by the media hordes that have descended on Oslo, the trophy cabinet of international prizes has been stuffed full in recent years. There is the brand new Queen Elizabeth Prize for Engineering in the UK, the AM Turing Award, the Abel Prize, the Asahi and the Kyoto prize. The Russian billionaire Yuri Milner recently endowed the Fundamental Physics Prize by offering $3 million to each winner – three times the prize money given out by the Nobel Foundation. Perhaps most star-studded of all is the Breakthrough Prize in Life Sciences  - a joint enterprise by tech superstars including Sergey Brin, co-founder of Google and Mark Zuckerberg, founder of Facebook.

The Internet’s man in Washington

How Darrell Issa, a San Diego Republican, became Web advocates’ closest, and most perplexing, ally in Congress.  Rep. Darrell Issa (R-CA) (R) speaks with aide during testimony to the House Rules Committee about a proposed vote to find U.S. Attorney General Eric Holder in contempt of Congress during a hearing on Capitol Hill in Washington June 27, 2012. REUTERS/Joshua Roberts

 

At the frenzied height of last winter’s unprecedented collective rebellion against the Stop Online Piracy Act it was easy to forget that there had once been a time when SOPA was both an obscure and obdurate little piece of legislation, a 78-page digital copyright bill that, both in and out of Washington, was considered inevitable, when it was considered at all.

The moment that seemed to change was on Dec. 15, 2011, the first day of the House Judiciary Committee’s consideration of SOPA’s text. Representative Jason Chaffetz, exasperated by Congress’ slap-dash efforts to rewrite the rules governing the online world, said SOPA was like amateurs doing home surgery.

California v. Texas in fight for the future

It is not a national election year, but the “red state versus blue state” wars continue. Texas Governor Rick Perry’s recent foray into California, to lure away businesses and jobs, signals more than a rivalry between these two mega-states. The Texas-California competition represents the political, economic and cultural differences driving American politics today – and for the foreseeable future.

Texas and California are robust political and economic competitors. We don’t know which will be the template for the future. As California emerges from its economic and fiscal doldrums and some of Texas’ vulnerabilities become evident, it is now far from certain that Texas will emerge the victor.

California is a global hub for trade, tourism, culture and the manufacture of ideas and intellectual property. From high tech and biotech to entertainment, travel and logistics, the state’s brand transcends national boundaries. The Golden State tops the nation in agriculture. It also sets the pace on green energy development, which could lead to a dramatic increase in the state’s energy production.

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