Silicon Valley Vs. Wall Street: Can the New Long-Term Stock Exchange Disrupt Capitalism?

Tech luminaries back new exchange that rewards shares with more voting power the longer investors own them

..  the voting power of shares increases the longer investors own them. Firms listed on the exchange would need to use such a structure, often called “tenure voting,” while abiding by numerous other rules, such as a ban on tying executive pay to the company’s short-term financial performance.
.. skeptics wonder whether the LTSE is just another way for tech founders and elite Silicon Valley investors to maintain control at the expense of other shareholders. One leading New York hedge-fund manager who asked not to be named called tenure voting “disgusting” and said it would enable managers to duck accountability.
.. The LTSE is funded by a range of venture-capital firms, led by Peter Thiel’s Founders Fund, Andreessen Horowitz, SV Angel and Greylock Partners, and individual investors including former Twitter Inc. CEO Dick Costolo, AOL co-founder Steve Case and Groupon Inc. founder Andrew Mason. The firm says it has raised $19 million from around 70 investors in all.
.. SEC Chairman Jay Clayton .. has voiced concerns about the nearly 50% drop in the number of U.S. public companies over the past two decades—a trend that is partly due to companies choosing to stay private for longer.
.. executives’ bonuses couldn’t be tied to financial-performance targets over periods of less than one year. If the executives are paid in company stock, the shares couldn’t fully vest for at least five years.
.. they would be barred from releasing quarterly earnings guidance
.. the voting power of his or her shares would grow over time, capped at 10 times the power of ordinary common stock after a decade.
.. The voting structure will depress the share price of any company listed on the LTSE, said Neal Wolkoff, former CEO of the American Stock Exchange. “Fewer people will want to buy into a company where there’s entrenched management,” he said.
..  In his view, tenure voting is better than the solution favored by some Silicon Valley firms: severely limiting the voting power of ordinary shareholders through two or more share classes.

Snap Inc., for instance, has a controversial multiple-class share structure in which shareholders who buy the company’s common stock listed on the New York Stock Exchange don’t get voting rights at all.

How do you encourage the workforce without incentives?

Numerous studies have shown time and again that money is an extremely poor motivator. Drive: The Surprising Truth About What Motivates Us is a well sourced book which dives into the topic. The author, Dan Pink, has a really nice animated version of a talk he’s given summarizing the findings.

While monetary incentives are a poor motivator, instead people are primarily motivated by Autonomy, Mastery, and Purpose.

Autonomy — Our desire to be self directed. It increases engagement over compliance.

Mastery — The urge to get better skills.

Purpose — The desire to do something that has meaning and is important. Businesses that only focus on profits without valuing purpose will end up with poor customer service and unhappy employees. [wikipedia]

Based on your description, it looks like the company has a lack of Autonomy and Purpose (your question doesn’t mention much relating to Mastery).

The employees aren’t self-directed and in control of their own fates. They’re being asked to work overtime because things are off schedule, again cutting into their autonomy.

They likely don’t feel like there is much purpose to the work they’re doing, which is evidenced by their resistance towards additional overtime.

So, how do you solve this problem? There’s no “easy fix” and no “one size fits all” approach. Especially as you’re already between a rock and a hard place.

It may help to communicate the reason behind the contract, what it means for the company, what it means for the customer, what it means for the customer’s customers, etc. There may be some employee engagement activities you can organize to help them understand the reason their work matters. This can’t be superficial, or trite either, that will backfire. Honestly, the company/project purpose needs to be defined and ingrained in the culture. If you have done that yet, now it’s the time to start, but don’t stop as soon as the current fire burns out. (Thanks to the commenters for pointing this out)

It may help to solicit feedback from the employees about how to proceed. Give them an opportunity to right the ship themselves. You likely have a bunch of smart people who understand the work, customer, environment, etc. and likely have lots of ideas they may not feel comfortable sharing that could help.

If you’ve been running in overtime mode for a long time, it’s quite likely that things like new opportunities, moving teams, changing technologies, etc. are being sacrificed in the misguided notion that “we don’t have time for that”. Happy employees are always better, more productive employees.

.. Perhaps if managers were held accountable for agreeing to unrealistic customer requests and you consulted your workforce about whether they’d agree to perform some overtime to help the company before agreeing to customer demands, the employees would feel more like team players. – David Schwartz 2 days ago

President Trump’s Growth Budget

It will restore the Clinton-Gingrich welfare reforms that made it more profitable to work than not work.

the measure of budget success for the Trump administration is not how much federal assistance is given out, but how many people leave government dependency and join the private labor force as full-fledged workers.

.. the best of government intentions have actually backfired by reducing incentives to work and earn.

.. The expansion of food stamps, welfare, health-insurance subsidies, unemployment assistance, and disability assistance have led to unintended consequences and perverse after-tax incentives, such that it pays more to stay on assistance then to go to work. At the working-poor margin, taking a job may rob you of Obamacare subsidies. So better off not to work.

.. Mulligan estimated that the marginal tax rate — the extra taxes paid and subsidies foregone as the result of working — had increased from 40 percent to 48 percent.

.. increase federal Medicaid spending from $378 billion today to $524 billion in 2027. That ain’t a cut either. It’s an increase.

.. Adding up each and every new year between now and 2027, the federal government will spend about $55 trillion. Do we think that’s enough? And the Trump budget would curb that by about 7 percent, or roughly $4 trillion. That’s all that’s happening.