Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      Icasa told to align on BEE in move that will favour Starlink - Solly Malatsi

      Icasa told to align on BEE in move that will favour Starlink

      12 December 2025
      South African solar industry faces a reality check

      South African solar industry faces a reality check

      12 December 2025
      OpenAI launches GPT-5.2 after 'code red' push to counter Google. Shelby Tauber/Reuters

      OpenAI launches GPT-5.2 after ‘code red’ push to counter Google

      12 December 2025

      A leaner BCX positions itself as market consolidator

      11 December 2025
      Australia has banned kids from social media. Should South Africa follow suit?

      Australia has banned kids from social media. Should South Africa follow suit?

      11 December 2025
    • World
      Oracle’s AI ambitions face scrutiny on earnings miss

      Oracle’s AI ambitions face scrutiny on earnings miss

      11 December 2025
      China will get Nvidia H200 chips - but not without paying Washington first

      China will get Nvidia H200 chips – but not without paying Washington first

      9 December 2025
      IBM reportedly close to $11-billion deal to buy Confluent - Arvind Krishna

      IBM reportedly close to $11-billion deal to buy Confluent

      8 December 2025
      Amazon and Google launch multi-cloud service for faster connectivity

      Amazon and Google launch multi-cloud service for faster connectivity

      1 December 2025
      Google makes final court plea to stop US breakup

      Google makes final court plea to stop US breakup

      21 November 2025
    • In-depth
      Black Friday goes digital in South Africa as online spending surges to record high

      Black Friday goes digital in South Africa as online spending surges to record high

      4 December 2025
      Canal+ plays hardball - and DStv viewers feel the pain

      Canal+ plays hardball – and DStv viewers feel the pain

      3 December 2025
      Jensen Huang Nvidia

      So, will China really win the AI race?

      14 November 2025
      Valve's Linux console takes aim at Microsoft's gaming empire

      Valve’s Linux console takes aim at Microsoft’s gaming empire

      13 November 2025
      iOCO's extraordinary comeback plan - Rhys Summerton

      iOCO’s extraordinary comeback plan

      28 October 2025
    • TCS
      TCS+ | Africa's digital transformation - unlocking AI through cloud and culture - Cliff de Wit Accelera Digital Group

      TCS+ | Cloud without culture won’t deliver AI: Accelera’s Cliff de Wit

      12 December 2025
      TCS+ | How Cloud on Demand helps partners thrive in the AWS ecosystem - Odwa Ndyaluvane and Xenia Rhode

      TCS+ | How Cloud On Demand helps partners thrive in the AWS ecosystem

      4 December 2025
      TCS | MTN Group CEO Ralph Mupita on competition, AI and the future of mobile

      TCS | Ralph Mupita on competition, AI and the future of mobile

      28 November 2025
      TCS | Dominic Cull on fixing South Africa's ICT policy bottlenecks

      TCS | Dominic Cull on fixing South Africa’s ICT policy bottlenecks

      21 November 2025
      TCS | BMW CEO Peter van Binsbergen on the future of South Africa's automotive industry

      TCS | BMW CEO Peter van Binsbergen on the future of South Africa’s automotive industry

      6 November 2025
    • Opinion
      Netflix, Warner Bros deal raises fresh headaches for MultiChoice - Duncan McLeod

      Netflix, Warner Bros deal raises fresh headaches for MultiChoice

      5 December 2025
      BIN scans, DDoS and the next cybercrime wave hitting South Africa's banks - Entersekt Gerhard Oosthuizen

      BIN scans, DDoS and the next cybercrime wave hitting South Africa’s banks

      3 December 2025
      Your data, your hardware: the DIY AI revolution is coming - Duncan McLeod

      Your data, your hardware: the DIY AI revolution is coming

      20 November 2025
      Zero Carbon Charge founder Joubert Roux

      The energy revolution South Africa can’t afford to miss

      20 November 2025
      It's time for a new approach to government IT spend in South Africa - Richard Firth

      It’s time for a new approach to government IT spend in South Africa

      19 November 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » World » How Zuck wrested control of Facebook from shareholders

    How Zuck wrested control of Facebook from shareholders

    By Editor2 February 2012
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp
    Mark Zuckerberg

    Mark Zuckerberg controls a majority of Facebook’s voting rights, and will continue to enjoy that control after it goes public, according to an unusual arrangement he struck with some key investors and colleagues among Facebook’s shareholders.

    A string of voting arrangements outlined in Facebook’s Securities and Exchange Commission filing show that some of the company’s most powerful shareholders have ceded their voting rights to Zuckerberg, the company’s chief executive. While Zuckerberg only owns 28,2% of the Facebook’s shares, the additional “shares subject to voting proxy” gives him an additional 30,6% of the voting power, leaving him with a total of 56,9% of the shareholder voting power. That gives Zuckerberg full control of the company’s decision making.

    Under the arrangement, Dustin Moscovitz, Sean Parker and a host of other Silicon Valley bigwigs have given Zuckerberg “irrevocable proxy” to control their votes. That means that their shares will swing with his shares.

    Zuckerberg also has irrevocable control over shares held by DST, Greylock, Accel Partners and other major firms and investors — and the voting rights that go along with those shares — in most circumstances.

    “This is not common at all,” said Menlo Ventures partner Mark Siegel, who has monitored quite a few IPOs in his time in Silicon Valley and spoke to VentureBeat by phone today.

    “He negotiated a very unique deal,” said Siegel of Zuckerberg’s coup. While no one knows exactly why Moscovitz, Parker and a slew of high-powered venture capital firms would have given up their votes, Siegel speculated, “I’m sure there’s a point where shares were offered with that as a contingency.”

    In other words, this may have been a quid-pro-quo trade of money (shares) for power (votes).

    And maintaining power is something that Zuckerberg has focused on since Facebook’s inception.

    “To give Mark and Sheryl their due, it looks brilliant having turned down those earlier offers,” said Siegel, referring to a past multibillion-dollar acquisition offer from Yahoo. “I think they understood before a lot of us did what the potential of the company was… Staying independent and private was a pretty smart move.”

    Now, Zuckerberg will continue to exert his control over the publicly traded company; with his block of votes, he will have more sway in important decisions such as changes to the board, mergers, or splitting up parts of the company.

    “Every company puts in place things like a poison pill, things that make it possible for dissenting shareholders to prevent a hostile takeover,” said Siegel. “Presumably [the voting arragement] puts more of that control in one individual’s hands … it concentrates a lot of traditional protections.”

    Separately, a special “class B” of shares has let Zuckerberg and a small group of executives and employees at Facebook exert more control than they otherwise would by giving them 10 times the number of votes per share than “Class A” shares. Class A shares are the ones public investors will get.

    This will also give Zuckerberg the ability to maintain control of Facebook even if some of his proxy friends decide to sell their shares. That’s because, under the rules of Facebook stock, those class B shares, if sold, automatically get converted to class A. Thus, people buying from the special proxy share owners will only get class A shares with only one vote per share. Zuckerberg is thus left a greater majority of the powerful class B shares, and thus will be more able to maintain control overall.

    So, except for unforeseen edge cases, Zuckerberg will maintain control of a huge block of Facebook shares (and votes) until he dies or divests. But as far as Facebook is concerned, Moscovitz, Parker, DST and others don’t constitute a group because they’re not voting together — Zuckerberg is voting for them.  — Jolie O’Dell, VentureBeat

    • Image: Jolie O’Dell, VentureBeat
    • Subscribe to our free daily newsletter
    • Follow us on Twitter or on Google+ or on Facebook
    • Visit our sister website, SportsCentral (still in beta)


    Accel Partners DST Dustin Moscovitz Facebook Greylock Mark Zuckerberg Sean Parker
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleShinn is new shadow communications minister
    Next Article How SA start-up wants to ‘reinvent search’

    Related Posts

    Australia has banned kids from social media. Should South Africa follow suit?

    Australia has banned kids from social media. Should South Africa follow suit?

    11 December 2025
    Australia fires starting gun on global social media reform

    Australia fires starting gun on global social media reform

    10 December 2025
    Why smart glasses keep failing - no, it's not the tech - Mark Zuckerberg

    Why smart glasses keep failing – it’s not the tech

    19 October 2025
    Company News
    When the physical world goes online: the new front line of cyber risk - Snode Technologies

    When the physical world goes online: the new front line of cyber risk

    12 December 2025
    Endless possibilities with Adapt IT Telecoms' unified VAS platform - Matthew Seabrook

    Endless possibilities with Adapt IT Telecoms’ unified VAS platform

    11 December 2025
    Securing IoT connectivity: how MSB Micro Systems keeps devices in check

    Securing IoT connectivity: how MSB Micro Systems keeps devices in check

    11 December 2025
    Opinion
    Netflix, Warner Bros deal raises fresh headaches for MultiChoice - Duncan McLeod

    Netflix, Warner Bros deal raises fresh headaches for MultiChoice

    5 December 2025
    BIN scans, DDoS and the next cybercrime wave hitting South Africa's banks - Entersekt Gerhard Oosthuizen

    BIN scans, DDoS and the next cybercrime wave hitting South Africa’s banks

    3 December 2025
    Your data, your hardware: the DIY AI revolution is coming - Duncan McLeod

    Your data, your hardware: the DIY AI revolution is coming

    20 November 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    Icasa told to align on BEE in move that will favour Starlink - Solly Malatsi

    Icasa told to align on BEE in move that will favour Starlink

    12 December 2025
    South African solar industry faces a reality check

    South African solar industry faces a reality check

    12 December 2025
    TCS+ | Africa's digital transformation - unlocking AI through cloud and culture - Cliff de Wit Accelera Digital Group

    TCS+ | Cloud without culture won’t deliver AI: Accelera’s Cliff de Wit

    12 December 2025
    OpenAI launches GPT-5.2 after 'code red' push to counter Google. Shelby Tauber/Reuters

    OpenAI launches GPT-5.2 after ‘code red’ push to counter Google

    12 December 2025
    © 2009 - 2025 NewsCentral Media
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}