Founders without Limits
Dual-Class Stock and the Premium Tier of the London Stock Exchange

The first comprehensive collation of the international history of, and evidence on, dual-class stock, and their relevance to UK policy.

Bobby V. Reddy (Author)

9781108839358, Cambridge University Press

Hardback, published 11 November 2021

458 pages
23.5 x 15.8 x 3 cm, 0.86 kg

'Dual-class stock listings of companies are becoming increasingly more attractive to their stakeholders. Bobby Reddy's book is the authoritative exposition of the legal and regulatory development of dual-class stock listings in the US, the UK and around the world. It is an invaluable reference guide for students, academics and practitioners alike.' Dr Guy O'Keefe, Partner, Slaughter and May

Big Tech has flourished on the US public markets in recent years with numerous blue-chip IPOs, from Google and Facebook, to new kids on the block such as Snap, Zoom, and Airbnb. A key trend is the burgeoning use of dual-class stock. Dual-class stock enables founders to divest of equity and generate finance for growth through an IPO, without losing the control they desire to pursue their long-term, market-disrupting visions. Bobby Reddy scrutinises the global history of dual-class stock, evaluates the conceptual and empirical evidence on dual-class stock, and assesses the approach of the London Stock Exchange and ongoing UK regulatory reforms to dual-class stock. A policy roadmap is presented that optimally supports the adoption of dual-class stock while still protecting against its potential abuses, which will more effectively attract high-growth, innovative companies to the UK equity markets, boost the economy, and unleash the true potential of 'founders without limits'.

Introduction: 1. The cult of dual-class stock in the era of big tech
2. A tale of two cities and beyond
3. First among equals? Other methods of creating a divergence between voting and cash-flow rights
4. Shareholder democracy, and corporate purpose
5. From controlling shareholders to dual-class stock
6. Theoretical benefits and detriments of dual-class stock
7. The empirical evidence on dual-class stock
8. The existing constraints
9. A balanced protection package for inferior-voting shareholders
Epilogue
Appendix: The proposed enhanced inferior-voting shareholder protection package for the UK's premium-tier with a comparison to other major dual-class stock exchanges
Index.

Subject Areas: Stocks & shares [KFFM2], Investment & securities [KFFM], Finance [KFF], Economics, finance, business & management [K]