Market votes and founder votes

The bull market can hide a bear market underneath it. A cap table can hide the same thing: the person who owns less may still control the company.

Samir Hajibayli, Baku city, VC, LinkedIn 

Two things stayed with me this week. One was a market chart showing that the S&P 500 could sit close to a record while most companies inside it were far below their own highs. The other was Anthropic’s plan to let its founders keep control even though none of them owns anything close to a majority. They look like separate stories. Both are reminders that the headline number rarely tells us where the real weight sits.

The market is bullish and most stocks are not

The Kobeissi Letter called the present moment a bull bear market. At the time of its analysis, the S&P 500 was about 2% below its record. Yet 84% of the companies in the index were at least 10% below their own peaks. 59% were down by 20% or more, which is the usual definition of a bear market for an individual stock. Just ten companies had produced 70% of the index gain since March 30.

This explains why the economy and the market can feel so different depending on where somebody is standing. An investor holding the largest technology names can see a strong bull market. A founder trying to raise money, or a shareholder outside those winners, may already feel as if the correction arrived months ago. A record index does not mean that capital is equally confident everywhere.

Kobeissi reads the narrowness as an opportunity. If oil prices, inflation and borrowing costs ease, money could spread into the hundreds of stocks that have been left behind. That is possible. The same numbers also show fragility. When a small group carries most of the return, one weak earnings season can affect the whole index. Research cited by Business Insider found that market breadth was unusually poor for an index near a record, and that similar gaps have often appeared before market peaks.

The outlook is more about dispersion than direction

I do not think the useful decision is to choose a bull or bear label and defend it. The more likely outlook is a market that remains divided. If financing costs fall, the rally can broaden quickly. If rates and energy prices stay high, the largest companies may continue to rise while weaker businesses struggle. If those leaders then disappoint, there is less support underneath them.

The signal I would watch is simple: do gains begin to spread beyond the same few names? I would also look for better earnings outside AI and for borrowing costs to stop rising. Until then, a high index should not be confused with an easy funding environment. Public markets can celebrate a handful of giants while private companies face slower rounds, lower prices and harder questions.

A founder can own less and still decide more

This brings me to ownership. We often look at a cap table and assume that ownership and control are the same. They are not. Economic ownership decides who receives the value if a company pays a dividend or is sold. Voting rights decide who elects the board and approves the largest decisions. Board appointment rights can create a third layer of power. A founder may own a minority of the economics and still keep the final vote.

Anthropic is a clear example, with one important correction to the version often repeated online. Dario Amodei is not asking for 51% of the vote for himself. The company’s seven co-founders collectively direct one special Class F share through a Founder LLC. That share carries 50.1% of the voting power over key matters. Outside reports place each founder’s economic stake near 2%, although the filing reviewed by Reuters did not disclose the exact individual holdings.

The structure is more careful than permanent control by one person. A majority of the seven founders direct the Class F vote. Anthropic’s Long Term Benefit Trust elects four of the seven directors, and the special power begins to expire when only two founders or successors remain. The company says this protects its public benefit mission from short term market pressure. That argument carries weight in a business where one unsafe decision could affect far more than shareholders.

It also asks public investors to provide money while accepting a limited voice. That matters more as the company grows. This week, prospective investors were told that third quarter revenue reached $16.8 billion, up 45% from the previous quarter, while Anthropic is considering a valuation above $2 trillion. The New York City comptroller, who oversees pension funds with more than $325 billion in assets, then asked Anthropic to delay its IPO until it addresses safety and governance concerns. At that size, governance is no longer a private preference among founders.

Google wrote this playbook

Larry Page and Sergey Brin made the same basic choice when Google went public in 2004. Their founder’s letter said the structure was designed to preserve a long time horizon and many of the advantages of being private. Alphabet now has three shared classes. The letters themselves are only labels, and other companies can use them differently. The voting rights in the charter are what matter.

Alphabet class	Votes per share	Typical role
Class A	1	Public shares with an ordinary vote
Class B	10	Founder and insider shares that are not publicly traded
Class C	0	Public and employee equity without a regular vote

At the end of 2025, Page and Brin owned about 89.3% of the Class B shares and controlled 52.7% of Alphabet’s total voting power. Class C lets Alphabet issue employee stock or use shares in acquisitions without reducing the founders’ relative vote.

The structure gave Google patience for expensive bets and protection from investors focused on the next quarter. It also made it difficult for outside shareholders to force change. The same voting power can protect a good founder’s conviction and a bad founder’s mistake. The quality of the guardrails therefore matters as much as the number of votes. Special rights should expire after a defined period, convert when the shares are sold, and allow removal for serious misconduct. An independent board must still be able to challenge the founder.

Character AI Shows What Control Cannot Save

Character AI filed for Chapter 11 this week. Two years ago it had more than 200 million registered users, 20 million monthly users and a $1 billion valuation. In 2024, Google paid about $2.7 billion to license its technology and hire the two founders and roughly 30 researchers. The remaining company kept the users and the brand, but lost much of the team that made the product valuable.

The economics then became impossible to ignore. Character AI was still spending about $10 million a month on computing in 2025. Subscription revenue peaked at $2.8 million a month, and total monthly income never exceeded $5.3 million. The company had ownership, users and intellectual property. It no longer had a strong enough institution around them.

This is the other side of founder control. A special vote can protect founders from investors, but it cannot protect a company from dependence on the founders themselves. Startups also need succession plans, a team that can retain knowledge, and a board that can act when the original leaders leave. Control answers who decides today. Institution building determines whether the company survives tomorrow

What This Means for Our Region

For founders and investors in the Caucasus and Central Eurasia, this is practical rather than theoretical. A percentage on a cap table can create false comfort. Before a round closes, both sides should know who appoints the board, which decisions need investor approval, what happens if a founder leaves, and when special voting rights expire. These questions become much harder once the relationship is under pressure.

I support extra founder control when a company needs years to build a difficult product and when short term investors could damage the mission. I would pair it with clear limits. A regional startup could use supervoting rights for a fixed period, convert them when the founder’s stake falls below an agreed level, and give an independent director real authority. Investors should protect themselves on a sale, new share issue or related party deal without trying to run the company day to day.

The market outlook and the ownership debate meet at the same point. If Kobeissi is right and the rally widens, global capital will become more willing to take risk and some of that liquidity will reach our region. Companies with clean governance will be ready to use it. If the narrow market breaks instead, voting rights, board quality and capital discipline will matter even more because difficult decisions arrive quickly in a downturn.

This week made me less interested in the argument over whether the market is officially bullish or bearish. I want to know which companies are carrying the index, who carries the company after the founder leaves, and whether the structure can correct a mistake. Our region cannot control the next global cycle. We can build companies whose economics and decision making remain understandable in either one.