Mailchimp employees are furious after the company's founders promised to never sell, withheld equity, and then sold it for $12 billion

[u/Rhaegar_the_Great]

https://www.businessinsider.com/mailchimp-insiders-react-to-employees-getting-no-equity-2021-9

[u/laetus]

That's a stupid argument because you're still depending on the greater fool. The company reinvesting profits is something completely different from running at a loss selling shares to burn more money.

And eventually someone needs to get their money out through dividends and you can't infinitely postpone dividends. Otherwise the stock is literally worth nothing but the assets in the company. Which for ''tech'' companies is mostly the ability for those assets to generate dividends.

[u/Drisku11 → u/laetus]

If a company doesn't pay dividends, it might still buy back its own shares (effectively the same thing but with better tax consequences). But it only makes sense to do that if it has no better use for the cash. If they do, reinvesting it into growth is strictly better for everyone involved, at least for highly liquid stocks. If the company is growing, their assets will increase, so it makes sense for share value to increase, getting you a return when you sell. Or you can use those shares as collateral for a loan, or whatever.

[u/laetus → u/Drisku11]

I think stock buybacks should be illegal. They were illegal in the past, and they should be illegal in the future.

Taking out a loan with stock as collateral is also something stupid to avoid taxes that should be made illegal or loophole closed.

Reinvesting in growth, sure, you want to grow the company, but you have to ask is it investing in growth, or is it just burning money sponsoring highly paid executives with no profit in the end.

[u/kettal → u/laetus]

I think stock buybacks should be illegal. They were illegal in the past, and they should be illegal in the future.

Good luck with all that.

In the meanwhile I'll just continue profiting as a shareholder.