Facebook's IPO is coming up, meaning people will have to weigh those options when deciding if they want to buy it or not. However, one of those three reasons is entirely negated by the way the stock ownership has been structured:
The shares of Facebook will be divided into two classes. The Class A shares you will get if you buy shares in the market have one vote per share. The Class B Shares, which are almost all of the shares that have previously been issued and all of the shares owned by [founder and CEO Mark] Zuckerberg, get 10 votes per share.
Zuckerberg only owns about 28% of those super-voting Class B shares, so where does his control come from? He has voting agreements with many of his fellow shareholders that give him a proxy to vote enough additional shares to give him voting rights to a total of around 57% of the super-voting stock, the S1 shows. More than enough to give him control over the company.
Mark Zuckerberg has complete control of the company. Read the article to find out all the ways that he can stay in power if people try to change that fact. He personally can do whatever he wants because he holds over half of the stock voting power. He can even hire and fire the board of directors, who are supposed to be his bosses. You literally will have no power to change anything as a part-owner of the business unless Zuckerberg also goes along with it.
Of course, the first reason is likely to be moot as well. Growth companies don't tend to pay dividends, and that's what Facebook is. Apple is another tech growth company that famously doesn't pay a dividend, but it at least isn't controlled by a single person having the majority of the voting power.
For the foreseeable future, Facebook stock will be good for only one thing: trying to buy low and sell high. You're gambling on Zuckerberg's ability to guide the company and the hope that the collective hive mind of all stock investors will drive the stock price higher.
You're placing a bet, basically. Good luck with that.
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