Fact-checking SBF’s ‘circle jerk’ | Financial Times

If you’re extremely online like us you may already have come across the latest verbiage from FTX’s Sam Bankman-Fried. For those blessed with actual lives, we thought it worth highlighting just to gawp at someone widely held to have one of crypto’s smartest minds.

Normally we wouldn’t waste time stomping on the latest dumb thread in Crypto-Twitter, because life is short. But somehow “you can never have too much salt” is one of the least silly things SBF said in a long thread on traditional finance.

Click through for the full braindump:

To summarize, SBF has taken a very well-known factoid about some aspects of the past decade’s venture capital euphoria — that some dumb VCs have de facto subsidized some plainly uneconomic businesses in the name of “blitzscaling” — and turned it into an indictment of the Ponzi-like nature of modern capital markets as a whole.

Here, with fact checks, are edited highlights:

True! Meta made about $117bn in 2021, of which $115bn was from advertising. Good start!

Meta’s ad library shows 58 current FTX promo campaigns on Facebook. This is perhaps low-key in relative terms, but the “exploratory/experimental” approach involves significantly more web space than Affirm (17), Robinhood (29) and Coinbase (zero).

Facebook has been publicly listed since May 2012. Here via Bloomberg is its top 20 shareholders:

And again via Bloomberg, here’s the top five VC holders (who account for less than 0.01 percent of total ownership):

Ok, back up now. Google/Alphabet has been publicly owned since 2004 and has a very similar ownership profile to the Facebook/Meta one above. Also, the overwhelming majority of social media advertisers aren’t VC owned either: for 2020 in the US, Statista lists Disney, P&G, Amazon, HBO, Home Depot, Nestle, Samsung and Walmart as top corporate spenders, with Dunkin’ Donuts owner Inspire Brands the lone privately owned name.

Meta is Zuck to the extent that he has supervoting shares that coral about 58 percent of votes whenever there’s a shareholder proposal, meaning he does what he wants. It therefore makes a quite bad example when seeking to reboot the “shareholder overlap is communism” theme that was briefly popular in 2016.

Facebook/Meta has never paid a dividend as a public company. Google/Alphabet has never paid a dividend as a public company.

© 20th Television / Youtube

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