The plan was pitched as an AI financing tool. The disclosures tell a more personal story: Meta’s board was trying to preserve the founder’s control while confronting the financial and political pressure of California’s proposed billionaire tax.

July: Zuckerberg began negotiating with Meta’s board over protections against Proposition 40, a proposed one-time 5% levy on the assets of billionaires living in California as of Jan. 1, 2026. At his estimated wealth, the potential bill could approach $12.5 billion. Selling his existing supervoting Meta shares to cover it, the company warned, could reduce his voting power from 60.6% to 53%.¹

Sept. 9–13: The talks became more confrontational. Over dinner, Zuckerberg told directors that, without a deal, he would list his Palo Alto home — effectively signaling a possible departure from California. Board members saw his proximity to Meta’s Silicon Valley headquarters and its AI unit as essential, and reached an eight-year agreement for him to remain in California or another jurisdiction hosting Meta’s corporate headquarters, absent unforeseen circumstances.²

Wednesday: Meta unveiled the compromise: a new, non-voting Class C share class. The structure gives Zuckerberg a potential $20 billion of immediate liquidity without requiring sales that would erode his voting grip, while also equipping Meta to raise capital, pay employees and pursue acquisitions.²

Meta’s public case is broader than its chief executive’s tax exposure. The company says the investment required to compete through the AI transformation is “significant,” and CFO Susan Li said the stock would expand Meta’s funding tools as AI drives momentum across its businesses.³ Its projected capital expenditure this year stands at $135 billion to $145 billion.³

The board’s rationale is equally blunt: the Class C shares will “continue the founder-led model” behind Meta’s success.⁴ In other words, the AI cash plan and Zuckerberg’s control plan are not competing explanations. They are the same deal.