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A breakdown of Anthropic's pre-IPO governance, focusing on board composition and the Long Term Benefit Trust that controls voting power independent of typical shareholder structures. The author argues Anthropic should publicly disclose the trust agreement and voting agreement since the company claims to serve humanity's long-term interests with AI development.
- The board has 7 seats: 2 for common shareholders (the Amodeis), 1 for preferred shareholders, and 4 controlled by the Long Term Benefit Trust—meaning the LTBT effectively controls the company despite owning just one special class T share
- The LTBT trustees elect themselves and operate under a non-public trust agreement; there's no public mechanism for shareholders to dissolve or override the trust without its consent
- Anthropic's certificate of incorporation gives the Electing Preferred Director veto power over certain stock issuances and likely grants additional powers through non-public investor agreements, but most governance details remain opaque
During a 33-hour window when Automattic's board ousted CEO Matt Mullenweg, two executives signed reciprocal severance deals worth $8.15 million combined. Mullenweg returned and fired them, triggering a legal dispute over whether the agreements are valid.
- CFO Mark Davies and Chief Legal Officer Andy Missan each signed the other's severance agreement on September 10, granting 12 months salary plus accelerated equity vesting — deals that only take effect if they sign broad legal releases and comply with non-compete clauses.
- Davies held no Automattic stock at departure (sold "a few months ago" according to one source) but retained vested stock options, raising questions about his financial motivations during the board action.
- The severance agreements define "cause" so narrowly that Automattic faces a high bar to avoid paying out: the company must notify in writing within 60 days, give 30 days to fix the problem, and secure board majority approval — making legal challenges uncertain.
The article argues that even the best products can fail if companies lack proper corporate governance to guard against profit-driven predators. It reviews Eric Ries’s new book, Incorruptible, which outlines alternative governance structures—like “mission-locked” setups—to protect founders, culture, and long-term vision.
- Great products regularly fail not from market rejection but because investors/boards oust founders and erode culture once a product shows promise
- Traditional corporate governance (as designed by lawyers and business schools) makes companies vulnerable to hostile takeovers and mission drift, rather than protecting them
- Eric Ries's book "Incorruptible" proposes "mission-locked" governance structures that keep companies tied to their founding purpose regardless of investor changes
- Real companies have already implemented these mission-locked safeguards from inception, suggesting governance design deserves as much attention as the product roadmap
+ incorruptible
+ mission locked governance
+ founder protection
corporate governance
+ startups
+ investors
OpenAI has transitioned its for-profit subsidiary into a public-benefit corporation, allowing Microsoft to acquire a 27% stake and pushing its valuation above $4 trillion. This change aims to facilitate fundraising and talent acquisition while addressing concerns over OpenAI's commitment to its nonprofit mission amid ongoing litigation.
- OpenAI's for-profit subsidiary restructured into a public-benefit corporation, giving Microsoft a 27% stake
- The restructuring pushed Microsoft's valuation above $4 trillion
- The move is meant to ease fundraising and talent recruitment while facing litigation over whether it betrays OpenAI's nonprofit mission
+ openai
+ microsoft
+ for profit transition
+ public benefit corporation
+ fundraising
corporate governance