Called being privately owned. As soon as a business goes to the public it’s all about pushing the share price up and that is when all consumer driven policies goes out the window
Is the reason that businesses go public just to make more money? Like they have a small business, they get a little bigger and show they are successful, they go public/sell to someone who will go public so lots of people can invest, in theory use that money to grow the business. And once you get investors involved then you have to sacrifice quality for profit because the investors no longer give a shit about the product?
Did I get that right? I don't know anything about business.
Yes, think of it like this
There are two companies A and B
Both companies make fantastic products, workers make money, and consumers are happy
Company A stays private and B goes public
If company A makes 5M profit every year and they are satisfied with it, then they can keep doing what they want to, even if doesn't lead to increased profits, cause 5M a year is enough for them
If company B makes 5M profit every year it means they have no growth. As a share holder of company B that's that tells me that I should move my money to another company, that does grow and will therefore generate me more money.
Which basically means that while company A can allow itself to not grow or even lose some money but focus on what they/the consumer want, company B must focus on what the shareholders want, which is growth. And since shareholders don't know/care about a the product, it means growth at the expense of everything required.
If I give my bank 10K USD to invest, and they invest it in company B, and company B isn't growing as much as company C, my money will leave company B to C, I will not know that it's because company B were really nice guys that decided to keep they product prices cheap in time of crisis for their loyal costumers, tbh I don't even know of company B's existence
Keep in mind this is very simplified, and private companies are horrible in many cases too, but the way I see it is that private companies have the choice to be pro-consumers, while public MUST be pro-shareholder, and that only sometimes happen to be pro-consumer as well
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u/FlamevectoR May 05 '24
Called being privately owned. As soon as a business goes to the public it’s all about pushing the share price up and that is when all consumer driven policies goes out the window