Mark Zuckerberg Vows to Donate 99% of His Facebook Shares for Charity [NYT]
Mark Zuckerberg and his wife, Dr. Priscilla Chan, announced the birth of their daughter Maxima on Facebook (just like the rest of us!).
In that announcement, they also said that they'd be giving away 99% of their Facebook shares through the Chan Zuckerberg Initiative, currently worth $45 billion. Since most of you have a calculator handy, you can quickly realize that what remains is still quite a lot of money. It's a generous move, although not without its controversy:
By using a limited liability company instead of a nonprofit corporation or foundation, the Zuckerberg family will be able to go beyond making philanthropic grants. They will invest in companies, lobby for legislation and seek to influence public policy debates, which nonprofits are restricted from doing under tax laws. A spokeswoman for the family said that any profits from the investments would be plowed back into the Chan Zuckerberg Initiative for future projects.
There's a comment in the post of the NYT article (along with others) that takes a pretty cynical view of the whole thing, saying that its basically a tax avoidance ploy, and (s)he's not the only one. Those are fair criticisms, but Matt Levine rightly points out that the Zuckerbergs aren't paying taxes on those shares now!
[FB stock] doesn't pay a dividend, and unrealized capital gains aren't taxed. The only times that Zuckerberg would ever pay taxes on his massive pile of Facebook stock are (1) if he sells it or (2) when he dies. Presumably he doesn't need billions of dollars for living expenses, so (1) will not be a material source of tax revenue any time soon, and since he is young and healthy and rich and weirdly survivalist, (2) is probably a long way off as well.
As we all know, billionaire founders of companies have access to creative lawyers and accountants who help them minimize taxes, yes, even through charitable giving (or investing with good PR). And yes, it's all 100% legal making the back and forth quite enjoyable.
The CEO Paying Everyone $70,000 Salaries Has Something to Hide [Bloomberg]
For altogether different story, you must read the weird case of Dan Price, CEO of Gravity Payments, who is best known for making the minimum wage at his company $70,000 (and now the fact that his employees plank in meetings). This led to a media frenzy and in the course of this frenzy, a lawsuit filed by his brother Lucas emerged. Why the lawsuit emerged is where things get incredibly complicated:
As we talked about his wild six months, I brought up the lawsuit, asking if Price thought Gravity’s spending on the raises triggered his brother’s suit, as he’d implied. “I have no idea,” he slowly shrugged, looking right at me. “The quote in the Seattle Times from his attorney was, ‘It wasn’t only because of that.’ ” He twisted his beard between two fingers, contemplating the statement by Lucas’s attorney, Greg Hollon. “That one singular quote in the paper is the only information I have about if they were connected or not.”
Turns out, Karen Weise writes, "I realized Price knew more than he was letting on. The lawsuit couldn’t have been prompted by the pay raise—if anything, it may have been the other way around." Price gives Weise puzzling, repetitive and vague responses to her questions about the lawsuit and even allegations that he abused his ex-wife.
When a Job Offer Comes Without a Job [WSJ]
There's a new recruiting tactic companies are trying out called "program hiring" that "helps companies scoop up promising talent ahead of competitors and ensures their newest workers can stand a little uncertainty." I wouldn't worry about accounting firms doing this until around the time Maxima Zuckerberg gets her inheritance, but Intuit, maker of the QuickBooks, has been using it for about three years already and the process sometimes involves hires being made on the spot with little info for the candidates:
It took Cindy Chou five months to accept a full-time job at Intuit. After her internship with the company last summer, she was offered a position in its small-business unit.
Given few details, Ms. Chou, then a second-year M.B.A. student, waited before accepting the offer. “I could have really gone anywhere,” she said.
Later in the year, Ms. Chou had a series of conversations with hiring managers in different departments. She was notified that she was placed on the social-media marketing team of Intuit’s small-business unit about three weeks before her September start date.
The point being companies are now locking in recruits without giving them much of an idea of what they'll be working on. Naturally, results are mixed, with some students being comfortable while others can't stand the uncertainty.
In other news:
- Ed Bartak is the new RSM US chairman of the board.
- Yahoo Board to Weigh Sale of Internet Business [WSJ]
- Bitcoin mining Ponzi scheme.
- Whistle-Blower Complaint Directed at Whistle-Blower Group [DealBook]
- Baby Instagram names.