Snap Inc. Co-founder Evan Spiegel becomes third-highest-paid CEO in history
In just over six years, Snap Inc., the parent company behind image sharing social media platform Snapchat, has become a multi-million dollar business, earning $824.9 million in revenue in 2017. The company’s IPO on the New York Stock Exchange in March 2017 valued it at almost $34 billion, making it the largest IPO on a US stock exchange since Alibaba in 2014 ($168 billion). This valuation has also made Co-founder and CEO Evan Spiegel very rich; he was named the youngest billionaire in the world in 2015 by Forbes and is estimated to have a personal net worth of over $4 billion. Now, he is also the third-highest paid CEO in history.
A recent securities filing by Snap Inc. revealed that Evan earned $637.8 million in total compensation for 2017, the third-highest annual payment ever received by a company’s CEO in history. The only CEO paid more has been Daniel Och, CEO of hedge fund Och-Ziff Capital Management Group, who received an annual compensation of $918.9 million in 2007 and $1.19 billion in 2008. Evan’s earnings are made up of two major components – stock-based earnings worth $636.6 million (Evan and fellow Co-Founder Bobby Murphy together own 88.5 percent of Snap’s trade volume), and a salary-and-other-compensation component worth $1.2 million. According to Snap’s securities filing, Evan’s salary for 2017 was $98,078.
This comes after the recent news that Evan had sold over 2.7 million shares – worth around $50 million – in his first sale since Snap’s IPO. The sale was part of a pre-arranged sales plan to avoid concerns over insider trading as Snap’s share price dipped below its first-day trading price for the first time. The sale helped restore Snap’s stock price at the time, raising it to over $20 per share. However, the joy might have been short-lived; a recent tweet by American reality TV star Kylie Jenner that called Snap’s new update “so sad” sent the company’s share price tumbling again, effectively wiping out almost $1.7 billion in market value. Snap’s stock price was at $17.46 at the time of writing this article.
Kylie’s comments reflect a much wider disgruntlement among Snapchat users about the app’s recent redesign. A Change.org petition asking Snapchat to rollback the new look and feel of the app has already garnered over a million signatures, and since the redesign, the app has received more than 200,000 one-star reviews on the iOS App Store. Evan has defended the redesign publicly, even claiming that the backlash vindicates the company’s philosophy behind the change. He said in a statement, “We’re excited about what we’re seeing so far. Even the complaints we’re seeing reinforce the philosophy. The frustrations we’re seeing really validate those changes.”
However, the swings in Snap’s valuations don’t seem to have affected Evan’s personal takeaways heavily. Dan Marcec, Director of Content at executive compensation data firm Equilar, told Reuters, “I believe this is the largest value we have seen in the 10 years we’ve been compiling annual ‘highest-paid’ CEO studies.” Enough said.