Snap Co-Founder Spiegel Inches Closer to $588 Million Paydayby
His mega-grant will be paid out over three years after the IPO
Comes on top of ownership stake worth at least $3.4 billion
Spiegel, who’s also chief executive officer, is set to receive about 36.8 million restricted shares in the company once the offering closes, equal to about 3 percent of its outstanding stock. Valued at the high end of the pricing range disclosed Thursday, the so-called CEO award could result in a one-time windfall rarely seen since Mark Zuckerberg took Facebook Inc. public in 2012.
Snap is offering 200 million Class A shares for $14 to $16 apiece, according to a regulatory filing. At the high end of the range, that could give the company a market value of about $18.5 billion, based on the total shares to be outstanding after the listing. It’s the first U.S. social-media company to go public since Twitter Inc. more than three years ago.
Spiegel’s award will vest immediately on the closing of the offering. They’ll be delivered to him in increments over three years, starting about nine months after the offering. The payout would come on top of his stake in the company, which could be worth more than $3.4 billion, according to the Bloomberg Billionaires Index.
The award was granted in July 2015 to motivate Spiegel “to continue growing our business and improving financial results,” the registration statement said. Regulatory filings didn’t specify what would happen to the undelivered shares if Spiegel left before they’d all been handed over. He’ll receive Class C shares that each entitles him to 10 votes, while the publicly traded Class A shares won’t have any voting rights.
In terms of awards for tech company founders, Spiegel’s grant rivals only the 120 million stock options Facebook gave founder Zuckerberg in 2005. The securities had a $0.06 strike price and ballooned in value to $4.55 billion when the social-media company listed at $38 a share.
Twitter didn’t have to list compensation details for co-founder Jack Dorsey when the company went public in 2013 because he wasn’t a named executive officer. When he took over as CEO two years later, he disclosed an award of 2 million options he’d received in 2011 that would have been worth about $45.8 million at the $26 IPO price.