{"id":114,"date":"2026-05-24T20:09:12","date_gmt":"2026-05-24T20:09:12","guid":{"rendered":"https:\/\/reliablemovingcrews.com\/?p=114"},"modified":"2026-05-24T20:09:12","modified_gmt":"2026-05-24T20:09:12","slug":"from-meta-to-spacex-how-dual-class-shares-keep-founders-in-control","status":"publish","type":"post","link":"https:\/\/reliablemovingcrews.com\/?p=114","title":{"rendered":"From Meta to SpaceX: how dual-class shares keep founders in control"},"content":{"rendered":"<div><div><div><ul><li>Companies<\/li><\/ul><\/div><div><ul><li><svg><\/svg><div><div><div><button><span><span>Follow<\/span><\/span><\/button><\/div><\/div><\/div><\/li><li><svg><\/svg><div><div><div><button><span><span>Follow<\/span><\/span><\/button><\/div><\/div><\/div><\/li><li><svg><\/svg><div><div><div><button><span><span>Follow<\/span><\/span><\/button><\/div><\/div><\/div><\/li><\/ul><\/div><\/div><div>May 22 (Reuters) &#8211; The dual-class share structure outlined in SpaceX&#8217;s IPO filing, which grants CEO Elon Musk outsized control, has revived one of Wall Street&#8217;s oldest debates &#8211; that of corporate governance.<\/div><div>While such structures are hardly unusual in \u200bcorporate America, particularly among founder-led companies, few issues are so fiercely criticized by governance watchdogs.<\/div><div>Supporters argue visionary \u200cfounders should be insulated from short-term market pressures, while critics warn that concentrating power in the hands of insiders weakens accountability.<\/div><div>For many investors, Musk&#8217;s track record of building companies and his enormous public following make the governance concerns feel like a price worth paying as long as returns \u200bfollow.<\/div><div>Some others, however, have questioned whether Musk can devote sufficient time and focus to several of his high-profile \u200bventures.<\/div><h2>WHAT IS THE DUAL-CLASS SHARE STRUCTURE?<\/h2><div>Simply put, shares are divided into two classes under this framework. \u2060One class gives its holders greater voting power than the other, and these high-vote shares are typically held by founders \u200bor insiders.<\/div><div>In SpaceX&#8217;s case, Class B shares carry 10 votes per share, while Class A shares carry one vote each. \u200bMusk will own a majority of the Class B shares after the share sale, giving him significant control over shareholder decisions.<\/div><h2>WHY DO CRITICS HATE IT?<\/h2><div>Critics say &#8220;one share, one vote&#8221; is the cornerstone of shareholder democracy, and any corporate make-up that gives one class of investors more rights than others, \u200beven if they hold the same number of shares, concentrates power in the hands of a few.<\/div><div>&#8220;Over time, this founder-knows-best \u200bapproach can entrench management and blindside executives to a need for change in strategy,&#8221; according to the Council of Institutional Investors, a major \u200cinvestor \u2060group which has long fought against dual class shares.<\/div><h2>DO MULTIPLE SHARE CLASSES IMPACT STOCK PERFORMANCE?<\/h2><div>A 2024 study published in the Harvard Law School Forum on Corporate Governance showed that on average companies in the Russell 3000 index (.RUA)<svg><\/svg><span>, opens new tab<\/span> with dual or multi-class share structures outperformed those with a single share class, over five and 10-year periods.<\/div><div>However, a separate paper from the European Corporate Governance \u200bInstitute found that the valuation \u200bpremium enjoyed by dual-class \u2060firms tends to diminish over time, with such companies trading at a discount to their single-class peers roughly seven to nine years after their IPOs.<\/div><h2>DO INVESTORS CARE?<\/h2><div>&#8220;Most investors have thrown out \u200bthe idea that voting rights are valuable anymore, which is unfortunate,&#8221; said Brian Jacobsen, chief \u200beconomic strategist at \u2060Annex Wealth Management.<\/div><div>Besides, for companies such as SpaceX that are built around a popular founder, investors may be even more willing to trade voting rights for exposure to the business.<\/div><div>&#8220;Some investors may view that as a serious governance trade-off, while others may decide \u2060it is \u200bthe price of access to one of the few companies with SpaceX&#8217;s \u200bscale and positioning,&#8221; said Lukas Muehlbauer, IPOX research associate.<\/div><h2>WHICH OTHER COMPANIES HAVE DUAL CLASS SHARES?<\/h2><div>Google parent Alphabet (GOOGL.O)<svg><\/svg><span>, opens new tab<\/span>, Meta Platforms (META.O)<svg><\/svg><span>, opens new tab<\/span>, Palantir Technologies (PLTR.O)<svg><\/svg><span>, opens new tab<\/span>, Strategy (MSTR.O)<svg><\/svg><span>, opens new tab<\/span> and Berkshire Hathaway (BRKa.N)<svg><\/svg><span>, opens new tab<\/span> are \u200bamong companies with two or more classes of shares.<\/div><div><address><div><div><noscript>\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"120\" height=\"120\" alt=\"Niket Nishant\" class=\"wp-image-112\" src=\"https:\/\/reliablemovingcrews.com\/wp-content\/uploads\/2026\/05\/c2391e01d795f814097927afd2f73d6a.avif\"\/><\/figure>\n<\/noscript><\/div><div>Niket Nishant<\/div><\/div><div><ul><li><span><div><svg><title>Email<\/title><\/svg><\/div><\/span><\/li><li><span><div><svg><title>X<\/title><\/svg><\/div><\/span><\/li><li><span><div><svg><title>Linkedin<\/title><\/svg><\/div><\/span><\/li><\/ul><\/div><\/address><address><div><div><noscript>\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"120\" height=\"120\" alt=\"Manya Saini\" class=\"wp-image-113\" src=\"https:\/\/reliablemovingcrews.com\/wp-content\/uploads\/2026\/05\/b1e29c04765b21bcde954353718c5144.avif\"\/><\/figure>\n<\/noscript><\/div><div>Manya Saini<\/div><\/div><div><ul><li><span><div><svg><title>Email<\/title><\/svg><\/div><\/span><\/li><li><span><div><svg><title>X<\/title><\/svg><\/div><\/span><\/li><li><span><div><svg><title>Linkedin<\/title><\/svg><\/div><\/span><\/li><\/ul><\/div><\/address><\/div><\/div><p>Read more <a href=\"https:\/\/reliablemovingcrews.com\/?p=110\">Forensic experts sift through ruined dormitory in Russian-held Luhansk region<\/a><\/p><p>Read more <a href=\"https:\/\/reliablemovingcrews.com\/?p=108\">Netanyahu told Trump Israel will remain free to act against threats, Israeli source says<\/a><\/p><p>Read more <a href=\"https:\/\/reliablemovingcrews.com\/?p=106\">UK floated single market for goods with EU, media say<\/a><\/p>","protected":false},"excerpt":{"rendered":"<p>The dual-class share structure outlined in SpaceX&#8217;s IPO filing, which grants CEO Elon Musk outsized control, has revived one of Wall Street&#8217;s oldest debates &#8211; that of corporate governance.<\/p>\n","protected":false},"author":1,"featured_media":111,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[30,40,39,41],"class_list":["post-114","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-corporate-counsel","tag-corporate-governance","tag-legal-industry","tag-securities-enforcement"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>From Meta to SpaceX: how dual-class shares keep founders in control - Reliable Moving Crews<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/reliablemovingcrews.com\/?p=114\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" 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