In the world of Silicon Valley private equity, Elevation Partners has long stood out. It has a rock star among its founding partners, for a start.
It also takes big, hairy bets. You need a strong stomach to plough $460m into Palm. At last count that investment had roughly doubled in value, though Palm is still a long way from the finish line.
It’s equally hard to pass final judgment on some of its other big bets. A $300m-plus investment in games studios BioWare and Pandemic produced a 2X return within two years, though chunky investments in Forbes and internet real estate company Move look much tougher sledding.
Still, this week’s news of the first addition to the Elevation parternship in five years is a sign that it is now getting ready for round two.
Silicon Valley’s commitment to shareholder democracy – or to public shareholder democracy as opposed to the influence wielded by venture capital firms – does not seem to be strong.
The news that Facebook has established a dual-class share structure, converting its existing shareholders to Class B stock carrying 10 times the voting rights of Class A shares, suggests that (despite its denials) Facebook is readying itself for an initial public offering.
It is also falling in line with Google, which created a dual-class share structure for its IPO in 2004, which also gave 10 times the voting power to some shareholders. Eric Schmidt, the company’s chief executive, and Larry Page and Sergey Brin, its co-founders, control the majority voting rights as a result.