Jack Dorsey has been talking a lot recently about Twitter, his platform’s problems with Nazis, and even a meal he had with Mark Zuckerberg, who slaughtered a goat for him to eat. But there are several statements he made that Forbes would like to set straight, starting with the claim that “I’m not actually a billionaire.” Dorsey, no matter how he tries to distance himself from the label, is a billionaire - one that as of January 25 is worth $5.5 billion.
In a wide-ranging interview with Rolling Stone, Dorsey laid out a few claims about his wealth. We’ve checked those with public filings from both Square and Twitter, and Forbes’ research on his wealth. Here’s what we found:
“Most of my wealth, 98 percent of it, is equity in these companies, so I’m not actually a billionaire.”
TRUE AND FALSE. Forbes calculates that 98.2% of Dorsey’s wealth is tied up in the value of shares he owns in the two companies he cofounded. A whopping 85% of his net worth lies in his roughly 60 million shares of Square. It’s been a great asset to own: Square’s stock has shot up from $9 at IPO in 2015 to over $77 today. His 2% stake in Twitter makes up only 11% of his net worth.
As for Dorsey’s claim that “I’m not actually a billionaire” —sorry Jack. You’re a billionaire. Forbes has been publishing a list of the World’s Billionaires every year since 1987, and the vast majority of people on the list have their net worth in a company they either founded, inherited or invested in. Dorsey may not have $1 billion in cash sitting in the bank — Forbes estimates he’s netted at least $130 million, after taxes, from selling shares of Square and Twitter — but he is a billionaire thanks to his stakes in Square and Twitter. (You can also check his real-time net worth here.)
“I gave a third of my equity in Twitter back to the employee pool.”
TRUE. In 2015, Dorsey proposed giving a third of his equity back to employees; it was approved in May 2016. That same month he gave 6.8 million shares (then worth about $250 million) — which was 31% of his Twitter stake— to the Twitter Equity Incentive Plan.
“I gave [10 percent] of my equity in Square back to the company.”
TRUE. In December 2013, Dorsey told Fortune that he was returning 10% of his shares to the company. In its filing with the SEC for Square’s initial public offering, Dorsey also confirmed it when he wrote that “over the past two years I have given over 15 million shares, or 20% of my own equity, back to both Square and the Start Small Foundation…”. Forbes does not count those shares toward his net worth because he does not own them.
“I started a foundation called Start Small Foundation”
SORT OF TRUE. Dorsey’s Start Small Foundation isn’t a traditional foundation. In Square’s IPO filing, the company discloses that the Start Small Foundation is actually a donor-advised fund through the Silicon Valley Community Foundation, which means that Dorsey gave some of his shares to an account that must be used for a charitable purpose at some point in the future. Donor-advised funds don’t have to disclose where their donations go, something that more traditional charitable foundations must do annually. That means any claims Dorsey makes about where Start Small has been donating money, like in Ferguson, Missouri, can’t be traced.
At the time of the Square IPO, Dorsey also committed to donating another 40 million shares, or 10% of the entire company, to his foundation. There is no proof that he has followed through on that promise.
Instead, the next time Start Small appeared in a filing was in 2016 when it showed up as the Start Small LLC. According to the filing, Dorsey was the sole member of the LLC. Limited Liability corporations are not nonprofits and can make for-profit investments, donate to political campaigns, and operate as a business. The San Francisco Chronicle’s Owen Thomas also did extensive digging into the mystery of the Start Small Foundation and came to a similar conclusion: “The only thing that’s clear is there is absolutely no way to prove that he’s delivered on his public commitments.”
“I gave most of my Square equity to this [Start Small] foundation.”
FALSE. Dorsey still holds the majority of the equity he has held in Square. In 2013, according to this Fortune article, he gave 10% of his stake back to the company. Then he said at the IPO he had given 20% of his equity —15 million shares — to a combo of Square and Start Small over the prior two years (and that included the aforementioned gift in 2013, Forbes confirmed.) Today he still owns nearly 60.5 million shares of Square, down from 71.1 million shares he held when it went public. The math just doesn't pan out: He's kept most of his equity rather than giving it to his foundation. Square declined to comment on his claim and Dorsey didn't respond to a Twitter direct message from this reporter asking for an explanation.