Enlightened Equity Ownership
What would be the right formula? What should equity ownership be like?
What about a cap? A company is allowed 10 layers, and the top layer has a cap of 500 million, and layer 10 has a cap of five million. No matter what your equity ownership, once you hit that ceiling the rest of your equity goes back to the company to be given out to future team members. Or to charity.
(I got the 500 million figure from Mark Zuckerberg. I think it's a good number.)
Investors should also face caps. Maybe it is 50X for round one investors, 40X for round two, and 30X, 20X, 10X and so on.
This recycling will create a conveyor belt and more and more deserving people will be taken onto the realm of financial freedom.
Starting out, 10% to a charity of choice, 30% each to the founders, investors in various rounds, and team members over the years sounds right.
We are at the cusp of astounding rises in productivity. The old rules should not apply. You don't want to apply liquid physics to steam level activities. There has to be productivity thresholds, like the 100 degree mark for water. As soon as a company dealing with a cutting edge technology crosses that mark, 10% ownership should automatically go to the people collectively through a formula that touches all levels of government from local to global. The dividend should go into a fund that pays for a Universal Basic Income. Maybe it is 10%, maybe it is 20%, maybe more, depending on the level of rise in productivity.
When 1% of the world population can grow enough food for all people everywhere, it makes sense to take food off the economic table. That is a sufficient level of productivity rise.
