It's justified internally by the fact that Roy does not spend that money on himself, but rather on social projects. And as an employee you are made to feel bad if you suggest that you should be accumulating some of that wealth, rather than it going to more worthy people.
If he dreamt up such a company as TW then proceeded to build it with his own resources, without any outside funding, why shouldn't he be able to capture most of the value he created by keeping the profits from the sale?
Of course they did a big part of the work, and for that they got the compensation they negotiated, be it salary, equity or other benefits. At any point, they could have said "Hey, I don't like that this single person disproportionally benefits from the work we all do", and leave the company to do something else. (This is generally a hard statement to make, but I think for a company where such a big part of the employees are software engineers, I think it is reasonable to assume that they have a few options to shape their live into a direction they want.)
Apparently, in the end, Roy decided to act against his publicized beliefs, which just serves as a reminder, that words don't mean s#!t when it comes to business.
Oh come on, individual salaries compete against other people offering their services (and ultimately against the choice to starve by not working for the accepted rates), and has nothing to do with the value people generate.
Of course there's nothing unusual about this, in our capitalist system (which is extremely unfair, IMHO - can you tell?), but this was supposed to be different...
The sale price pretty much represents the discrepancy between what employees (including Roy himself) should have been paid if they were getting a fair cut of the value they generated, and what they were actually paid - or at it's least a projection of that into the future.
(I am generally not a fan of capitalism in its current form, so I'm playing devil's advocate here to a large degree.)
> Oh come on, individual salaries compete against other people offering their services (and ultimately against the choice to starve by not working for the accepted rates), and has nothing to do with the value people generate.
For the special case of high-demand jobs like software engineer, I don't think this holds up. If you are out for fair compensation in a "stable" job there are plenty of startups out there that will offer you equity. The easiest way, however, to be compensated as close as possible to "the value you generate" is to freelance.
Yes, those options are not optimal and you won't end up earning 100% of the value you generate but are generally the best way we currently have to approximate it. If we now would tweak some other parameters of our overall (international) economic system, like maybe higher taxes for large corporations (or one of X other possible solutions, I'm not trying to predict the right one), we could even end up with a system where injustices like severe wealth inequalities are minimized.
> but this was supposed to be different...
Yes, it was supposed to. They tried and failed, which is something that happens. If you invest too much (not necessarily money) into something that is not proven or even likely to be viable, that's just naive.
There really isn't such a thing as "the value people generate" beyond one-person businesses. As a simplified example, a business that sells software has two components: building software and selling software. The value of building software that isn't sold is zero. The value of selling software that isn't ever built is zero. But the business of doing both has value; the sum is greater than the pieces. So how do you allocate the surplus of cooperation? I don't think there's a fundamental theory that can explain one correct way of doing this. In real life, you allocate it by negotiation. It's not right, or wrong, it just is.
Indeed, when 'equal' partners negotiate a division of the value generated by the enterprise or 'company', that's probably about as fair as you can get. That would be called a 'co-operative' I think.
But that's not remotely the same as a company owned by a single individual, hiring employees who 'negotiate' their salaries in competition with other people who need employment - especially considering countries with very low wages, no social security (ie get a job, whatever the pay, or starve), etc.
By your logic Mark Zuckerberg who became a billionaire before hiting 30 certainly doesn't deserve the bulk of his riches since there is no way he could have done by himself, all the work thousands of engineers were hired to do at Facebook.
I know you might want to say there is a fundamental difference between a privately held TW and FB which took VC money early on, but I'm fairly confident that if Zuck thought he could build FB without taking VC money, he'd have gone that route, instead he went with dual-class shares as a reasonable compromise to retaining control of his company.
Yes that is exactly my logic, and no I don't want to say there's any difference between TW and Zuckerberg - they do not deserve to own the entire company, which has been built by all it's people.
yes, that is exactly what I would say, and no, I don't see much distinction between TW, Zuck, Bezzos, Page/Brin et al.
Sure in some cases people have risked money to start a business, or it's been built around a new idea or patent etc, and that should give the owners a disproportionate share of the company value/profits.
But not all of them.
The companies get built by all their people, not just owners, and the value of the company pretty much represents (albeit very indirectly) the difference between what those people have created, and what they've been paid.
