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Who Owns Nebula?

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Re: Who Owns Nebula?

#11

Post by derefr »

moi2388 wrote: post #3
danpalmer wrote: post #2

Interesting analysis! From the facts in this post, I'd reach the following speculation: the creators have a contract that entitles them to vote on certain types of company action, a share of 50% of the revenue, and potentially representation of their votes in the form of one or two of the existing board seats. Essentially there being some company bylaws in place to enact that "ownership" mechanism. This would match w…

That might very well be the case. It would probably be more honest to give the content creators stocks or say “partly ran by content creators” instead of “owned by content creators” in this case, no?

The problem with that is that if you truly own something, you have the right to sell that thing, and nobody can say who you can sell it to. Give it six months and it wouldn’t be “creator-owned” any more, due to cash-strapped creators dumping stock for a payday.

A co-op is structurally as much about ensuring that employees can’t transfer their equity to non-employees as it is about ensuring that employees have equity. You can’t get the semantics of a co-op ownership structure just by doing regular things with a C-corp; you need extra hacks, like these bylaws.

Re: Who Owns Nebula?

#14

Post by BlindEyeHalo »

moi2388 wrote: post #3
danpalmer wrote: post #2

Interesting analysis! From the facts in this post, I'd reach the following speculation: the creators have a contract that entitles them to vote on certain types of company action, a share of 50% of the revenue, and potentially representation of their votes in the form of one or two of the existing board seats. Essentially there being some company bylaws in place to enact that "ownership" mechanism. This would match w…

That might very well be the case. It would probably be more honest to give the content creators stocks or say “partly ran by content creators” instead of “owned by content creators” in this case, no?

The way I understood it is that the 'stock' you 'own' is proportional to your viewer count, which is not something you can do if you would actually give them stock.

Re: Who Owns Nebula?

#15

Post by wodenokoto »

danpalmer wrote: post #2

Interesting analysis! From the facts in this post, I'd reach the following speculation: the creators have a contract that entitles them to vote on certain types of company action, a share of 50% of the revenue, and potentially representation of their votes in the form of one or two of the existing board seats. Essentially there being some company bylaws in place to enact that "ownership" mechanism. This would match w…

I don't know about American coop laws, but in Denmark there are diary companies owned by farmers (nearly 10.000 farmers own Arla) and Coop Amba, which owns many super market chains have over 2 million members, that each have a voting right in the company.

You can totally scale this type of ownership.

Re: Who Owns Nebula?

#16

Post by LammyL »

This corporate structure seems a bit sketchy for creators if the platform wants to sell. If they sell Nebula then creators split half of the profits. If they sell Standard then creators get nothing.

Re: Who Owns Nebula?

#17

Post by sitharus »

danpalmer wrote: post #2

Interesting analysis! From the facts in this post, I'd reach the following speculation: the creators have a contract that entitles them to vote on certain types of company action, a share of 50% of the revenue, and potentially representation of their votes in the form of one or two of the existing board seats. Essentially there being some company bylaws in place to enact that "ownership" mechanism. This would match w…

It's definitely an interesting solution to a very similar problem I was looking at a few years ago - how to take on external investment in a co-operative company.

I'm not in the US, so I can't comment on the options for Nebula, but where I live coops are a specific type of legal company which would encompass what Nebula want - a company where profit is divided between members in proportion to their contribution. As part of that the only owners allowed are contributors, and the only people who can receive a profit share are the owners. If you want to stop contributing you have to stop owning, and there's no value to the shares.

So you can't take on equity funding, only debt.

This structure seems to be made to work around that, structuring it like a regular stock company but with a sale trap to make it unappealing to sell for a quick return.

Re: Who Owns Nebula?

#18

Post by SpicyLemonZest »

ehhthing wrote: post #9

I think the last few paragraphs go off the rails. If creators didn't own (at least in some way) some controlling stake in Nebula, why would they publicly say that they do? Moreover, why would creators join Nebula if the terms were not beneficial to them in the first place? I find it funny that the author writes > It’s equally possible, however, that the system was set up in order to keep any meaningful power away fro…

The author’s thesis is that the creators are being tricked. They own some complex bespoke right in Nebula (“an entirely new kind of cooperative corporate governance”), which they’re told and believe is equivalent to ownership, but actually it’s a sham that will break down if Standard ever wants to do something that isn’t in the creators’ interests.

Re: Who Owns Nebula?

#19

Post by jiveturkey »

> It’s possible that the terms are so favorable for creators that their shadow equity is as good as actual ownership. It’s equally possible, however, that the system was set up in order to keep any meaningful power away from the creators.

I very much suspect the latter. Otherwise why be so circuitous and secretive about it.

I've never heard of shadow equity before. But clearly it isn't equity, ie it isn't ownership. So it almost certainly has no governance rights. Now it may entitle the creators to 50% in the event of a sale, but who's to say it's Nebula that's sold, vs Standard, and who's to say it's sold at all. Rather the standard (excuse the pun) approach of selling off the assets without selling the company.

Re: Who Owns Nebula?

#20

Post by danpalmer »

wodenokoto wrote: post #15
danpalmer wrote: post #2

Interesting analysis! From the facts in this post, I'd reach the following speculation: the creators have a contract that entitles them to vote on certain types of company action, a share of 50% of the revenue, and potentially representation of their votes in the form of one or two of the existing board seats. Essentially there being some company bylaws in place to enact that "ownership" mechanism. This would match w…

I don't know about American coop laws, but in Denmark there are diary companies owned by farmers (nearly 10.000 farmers own Arla) and Coop Amba, which owns many super market chains have over 2 million members, that each have a voting right in the company. You can totally scale this type of ownership.

I'm not an expert by any means, but my understanding is that partnerships are very different legal entities to a typical US LLC. I believe a partnership is typically in many ways closer to what I suggested may be the case with Nebula – where the company has bylaws and contracts in place internally to make this work. On the other hand for an LLC, LTD, or other similar types of company, being a shareholder is a more public position, and might require reporting, or updating documents registered with the local government every time it changes. That's fine for tens of shareholders in a private company, but not for thousands or millions.
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