CEO Stock Ownership Confrontation

Martin Shkreli tells a story about confronting a CEO during a business meeting about not owning stock in his own company.

"I remember one of my analysts brought a management team over to pitch some stock or pitch a pipe. I asked the CEO why he didn't own any stock in his company. He started hemming and hawing, getting uncomfortable.

I said, 'I have your proxy right here' and put it down on the table. 'It looks like you make $550,000 a year. That's a good amount of money. Can you promise me today that you'll buy like 10,000 or $20,000 of your stock at least?'

The guy was just completely uncomfortable - it became the most uncomfortable meeting in the history of Wall Street because I kept hammering on it for 20 minutes. I kept saying 'Why can't you afford to spend $10,000 and buy your own stock? Stock price will go up, everyone wins, you'll show confidence.'

Most portfolio managers would say his personal finances are up to him, he's allowed to not own his stock. But I like to address the elephant in the room, even if it's really uncomfortable or difficult or embarrassing."