Super-voting shares in Uber held by Kalanick and his allies mean the board has little control over who fills CEO role
The rise of super-voting shares in Silicon Valley has given founders the ultimate job security. — As the calamities amass at Uber, many people—including me—have called for new leadership. Tweets: @backchnnl Tweets: Backchannel / @backchnnl : The rise of super-voting shares in Silicon Valley has given founders the ultimate job security. http://backchannel.com/...
Context & Ripple Effects
Backchannel's piece lands early in a six-month governance fight at Uber. The mechanism it flags — super-voting stock giving founders 'ultimate job security' — was soon visible in practice: by mid-June, every share employees sold back to the company under Uber's stock repurchase program transferred voting rights to Travis Kalanick himself, quietly concentrating control as the board searched for his replacement.
The board's constraint showed in the CEO search that followed, where a divided board lost Meg Whitman and worried a potential SoftBank investment would hand Kalanick even more power ([[a:921001]]). By fall, the answer was structural: a formal governance proposal aimed directly at limiting Kalanick's power. This article is the diagnosis that arc kept proving right.
First-order effects
- Travis Kalanick and allied super-voting holders can outvote any board majority on who becomes CEO, so directors pressing for new leadership cannot deliver it without his consent.
Second-order effects
- Every employee share bought back through Uber's repurchase program adds to Kalanick's voting bloc, meaning the company's own liquidity events strengthen the founder's grip while candidates like Whitman weigh whether the job is real.
Third-order effects
- If founder-controlled capital keeps overriding boards at crisis-scale startups, expect investors to demand explicit voting caps or sunset clauses at the IPO stage rather than trust board oversight after the fact.
The trend: Dual-class and super-voting structures are turning founder removal into a shareholder-negotiated event rather than a board decision, forcing governance reform to be written into cap tables before crises hit.