Snap CEO Named a Chief Business Officer, Then Changed His Mind • Hacker News Board

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#41

Post by stanleydrew » Mon, Oct 29, 2018, 9:01 PM UTC

sseveran wrote: post #21

hendzen wrote: post #4

SNAP IPO should herald the death of dual share class listings. They sold billions in equity to the public, but gave the shares 0 voting rights. So now investors have no recourse to push for changes at the board level.

S&P is now excluding such share structures from companies it considers for the S&P 500, so I would anticipate that this will get much rarer among public companies.

Interesting. Not saying I don't believe you, but I'm interested in what a company might perceive to be the value of being part of the S&P 500. Is it just a reputation boost? Or is there something concrete?

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#42

Post by jboy55 » Mon, Oct 29, 2018, 9:07 PM UTC

hendzen wrote: post #4

SNAP IPO should herald the death of dual share class listings. They sold billions in equity to the public, but gave the shares 0 voting rights. So now investors have no recourse to push for changes at the board level.

I always thought of SNAP shares as 'baseball cards'.

In the baseball card mania of the 90s, it was said they go up and down in value as the player does well and poorly. But, hey are completely devoid of inherent value.

I'm told SNAP shares would still get you some % if the company is bought, but I figure if someone does by SNAP they'll just purchase the voting stock from the founders and leave SNAP out there hanging around.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#43

Post by hendzen » Mon, Oct 29, 2018, 9:08 PM UTC

stanleydrew wrote: post #41

sseveran wrote: post #21

Earlier quoted context omitted.

S&P is now excluding such share structures from companies it considers for the S&P 500, so I would anticipate that this will get much rarer among public companies.

Interesting. Not saying I don't believe you, but I'm interested in what a company might perceive to be the value of being part of the S&P 500. Is it just a reputation boost? Or is there something concrete?

There is a massive value. It means that all SP500 tracking ETFs ($SPY, $VOO etc) have to buy your shares. It's a huge boost to your share price, especially with the rise of passive investing.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#44

Post by mrep » Mon, Oct 29, 2018, 9:24 PM UTC

gonehome wrote: post #14

whoisjuan wrote: post #5

I'm going to be devil's advocate here but the CEO (especially of a troubled company like Snap) needs to take the best decisions for the company and stretch solvency and viability for as long as possible. Of course, it's unpopular to promote someone, then rescind that offer and hire someone else. But in this case, the tradeoff seems reasonable. Hiring a well connected, veteran exec who comes from a company known for i…

I think you're probably right, but I'd be very surprised if Snap survives - they've been outplayed by Facebook and Zuckerberg is a better CEO. If you're looking for a stock to short Snap seems like a good choice - I'd bet on failure in a few years or some sad acquisition on poor terms. The only other tech company I'm pretty confident will fail is Magic Leap, but unfortunately they're private so hard to bet against.

Someone in my building has a magic leap and I got to try it yesterday and it was pretty impressive. We played angry birds and you could walk around the bird structure shooting birds at it and it perfectly tracked everything.

Granted I haven't tried any other AR or VR device but combine that with some CAD software, google assistant, and some leap motion style hand tracking and you're now Tony Stark building iron man.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#45

Post by EpicEng » Mon, Oct 29, 2018, 9:27 PM UTC

whoisjuan wrote: post #27

harryh wrote: post #20

Earlier quoted context omitted.

It's important to note that Kristen O’Hara was also an outsider who is a "well connected, veteran exec." She had only been with Snap for 2 months. Characterizing her as a "good employee, but ultimately an employee with no new insights or inputs" is probably not accurate.

True. But I think the contrast here is who is more capable of adding value to Snap. The Ex-Time Warner marketing executive or the Ex-Amazon Ad executive. Profile wise they are pretty similar but yet they come from very different industries and probably have very different operational philosophies. Also, 2 months is a very short time for everyone but Snap. In a 12 months runway, 2 months is 16% of the time you have be…

You're just making stuff up and trying to rationalize a decision you weren't in any way involved in.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#46

Post by School-Cotton » Mon, Oct 29, 2018, 9:31 PM UTC

jboy55 wrote: post #42

hendzen wrote: post #4

SNAP IPO should herald the death of dual share class listings. They sold billions in equity to the public, but gave the shares 0 voting rights. So now investors have no recourse to push for changes at the board level.

I always thought of SNAP shares as 'baseball cards'. In the baseball card mania of the 90s, it was said they go up and down in value as the player does well and poorly. But, hey are completely devoid of inherent value. I'm told SNAP shares would still get you some % if the company is bought, but I figure if someone does by SNAP they'll just purchase the voting stock from the founders and leave SNAP out there hanging…

What makes you think inherent value of stock is tied to voting rights?

If in the future Snapchat pays dividends, won't the non-voting SNAP shares still have dividends paid out at the same rate as everyone else? It was my impression that this (along with other profit-sharing mechanisms like buybacks) was what drives the inherent value of stock.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#47

Post by EpicEng » Mon, Oct 29, 2018, 9:32 PM UTC

whoisjuan wrote: post #36

harryh wrote: post #32

Earlier quoted context omitted.

I love it when people concede that a fact central to their line of reasoning is false, but argue that their conclusion is still true.

I don't know if you're being sarcastic or not, but my core argument wasn't trying to say Jeremi Gorman is better than Kristen O' Hara for this job. I don't have enough information to factually check that. I was defending Spiegel's decision (hence my devil's advocate opener) and why something that seems wrong for the general public may be what's best for a company like Snap at this point.

>I was defending Spiegel's decision (hence my devil's advocate opener) and why something that seems wrong for the general public may be what's best for a company like Snap at this point.

And the entire basis of your presumption was that O'Hara wasn't exactly what she is ("a well connected, veteran exec who comes from a company known for its operational excellence" who is also a new employee.)

Even if you were right from the start, you're just absolving a CEO of poor decision making. He didn't just "make a decision", he publically promoted someone to an important role and soon after changed his mind. Not exactly grand leadership on display.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#48

Post by dcole2929 » Mon, Oct 29, 2018, 9:42 PM UTC

I get that there is a widely held belief that startups eventually reach a point where they need veteran leadership. The kids built the thing but they need adult supervision in order to become a real company. But I find myself wondering what the logic is behind hiring a 40 year old to design the strategy for a company who's primary demographic is in their teens and twenties. Clearly this is a strategy that has worked before but I'm curious why more orgs don't try the opposite. If you won't listen to what your customers want (which Snap has not) why not hire a young executive who more closely aligns with the demographic your catering to.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#49

Post by nwsm » Mon, Oct 29, 2018, 9:43 PM UTC

whoisjuan wrote: post #5

I'm going to be devil's advocate here but the CEO (especially of a troubled company like Snap) needs to take the best decisions for the company and stretch solvency and viability for as long as possible. Of course, it's unpopular to promote someone, then rescind that offer and hire someone else. But in this case, the tradeoff seems reasonable. Hiring a well connected, veteran exec who comes from a company known for i…

Sure, let's say this new decision is the actual right one to make. It took him only two days to realize his mistake. What could he realize in two days that he couldn't in the (hopefully) weeks it took him to make the initial decision? Either they weren't diligent enough in making the initial decision, or they didn't like how someone (or their stock price) reacted to the decision and turned back. Both are bad.

Re: Snap CEO Named a Chief Business Officer, Then Changed His Mind

#50

Post by whoisjuan » Mon, Oct 29, 2018, 9:50 PM UTC

EpicEng wrote: post #47

whoisjuan wrote: post #36

Earlier quoted context omitted.

I don't know if you're being sarcastic or not, but my core argument wasn't trying to say Jeremi Gorman is better than Kristen O' Hara for this job. I don't have enough information to factually check that. I was defending Spiegel's decision (hence my devil's advocate opener) and why something that seems wrong for the general public may be what's best for a company like Snap at this point.

>I was defending Spiegel's decision (hence my devil's advocate opener) and why something that seems wrong for the general public may be what's best for a company like Snap at this point. And the entire basis of your presumption was that O'Hara wasn't exactly what she is ("a well connected, veteran exec who comes from a company known for its operational excellence" who is also a new employee.) Even if you were right f…

I don't think you have any facts to validate that either. I'm just going by their resumes. One is a former executive at Time Warner, the other is a former executive at Amazon. This is likely another vapid and factless analysis but it seems that Snap could benefit more from the latter. Either way my original point was that it's hard to understand decisions like this when the company's future is at stake.