• Triton

Snap IPO boils down to one question: Do you trust Evan Spiegel? - MarketWatch

Investors in the coming initial public offering of Snap Inc. will buy into an unprecedented corporate governance structure that won’t give them a voice, instead placing all the power in a pair of 20-something executives who have not proven they are worthy of such trust.

Buying shares in Snap amounts to a risky bet on the two co-founders, Chief Executive Evan Spiegel, 26, and Chief Technology Officer Robert Murphy, 28. The two former Stanford University fraternity brothers have a combined 88.6% of the voting power in the company, which will not be diluted because the shares issued in the IPO will have absolutely no voting power.

“They have the full suite of protections for management and the historic owners, plus the unprecedented protection that the stock they are selling to the public is nonvoting,” said Rett Wallace, co-founder and CEO of Triton in New York, which provides data and analysis on private companies.

“A cynic would say they are almost anticipating unhappy shareholders, as they have made unprecedented efforts to remove the levers uppity shareholders pull to express themselves,” Wallace of Triton said. “If they thought it was going to be a rough ride, they have prepared themselves very well to ride it out.”

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