Marqeta Inc. - MQ

Q1 2024 results plus the founder's transition

For some reason, the stock appears that it will open higher tomorrow. This is pretty much happening across the board with lots of names regardless of numbers, but in this case, perhaps folks have not really read about the finer points of the founder’s transition.

Jason Gardner is the founder, by the way, and (until recently) 50% voting shareholder. He gave up the CEO position in January 2023, and now appears to be stepping even further back. From the 10Q:

Plus, he is leaving quite a bit of equity on the table with his departure.

So he’s giving up his leadership position on the board and giving up a ton of equity, and what else can he do to top it all off? Prepare to dump some stock, of course.

The company recently settled a shareholder lawsuit saying that the company wasn’t doing enough to make sure Jason Gardner won’t get more equity without paying some sort of “control” premium for the shares. Mr. Gardner basically agreed he would stay below 50% on his voting totals, and now we know why.

He voluntarily dropped from owning over 50% of the voting shares to 40% so he can convert shares from the super-voting-but-non-trading “B” shares to the regular-voting-but-quickly-sellable “A” shares.

Think nothing is brewing here?

Onto the quarter.