How does a manager reward himself for a job well done? If you do not take a salary, the one option is to sell parts of the business that made you successful. This also applies to Spotify CEO Daniel Ek, who treated himself to a big payday in the shape of stock sales this 12 months.
And the Spotify co-founder is not the just one in the corporate to learn from the group’s share price explosion this 12 months.
Spotify managers earn a living
According to SEC filings analyzed by AssetsThe company’s executives begin to learn from the streaming company’s rising share price.
Five current Spotify executives and Paul Vogel, the recently departed former chief financial officer, have sold $254.4 million in shares because the start of 2024.
The bulk of that withdrawal got here from Ek, which cashed out $118.9 million in shares following the group’s second-quarter results, which followed a February sale price $59.9 million.
The Spotify CEO hasn’t drawn a salary since 2017, in response to company documents. He was probably one in every of the lowest-paid major tech CEOs last 12 months because the boss held off on selling shares in the corporate. He received $1.4 million in “other compensation.”
Gustav Söderström, Spotify’s chief technical officer and chief people officer, has sold a complete of $40.7 million in shares because the start of the 12 months. Of this, he invested around $30 million in two tranches on Wednesday and Thursday.
Alex Norstrom, the group’s chief business officer, has raised a relatively modest $12 million from stock sales this 12 months. Dustee Jenkins, Spotify’s chief public affairs officer, pocketed $343,000 in March.
Spotify Chief Human Resources Officer Katrina Berg transferred $7.7 million price of shares in February.
Meanwhile, former CFO Paul Vogel took home 14 million dollarsalso in February.
Vogel was fired from his position as CEO of Spotify in December when the corporate laid off 1,500 employees. At in regards to the time of the announcement, Vogel sold $9.4 million price of shares.
A Spotify spokesperson said: “As part of his long-term financial planning, Daniel Ek has sold some of his Spotify shares. These sales represent a limited portion of Mr. Ek’s interest in the Company.”
Spotify’s Payday
It’s not clear what exactly motivated Ek and his colleagues to make such large withdrawals earlier this 12 months. For the 2023 fiscal 12 months, Spotify’s top five executives have raised shares totaling a paltry $6.3 million.
But it probably has something to do with Spotify’s stellar begin to 2024.
The group’s shares have risen greater than 60% because the start of the 12 months, adding greater than $20 billion to the group’s value.
After the corporate reported record-breaking quarterly profits on Tuesday, Ek welcomed a brand new era of monetization at the corporate, which is capable of increase subscription prices while attracting recent members. The company has also refined its previously expensive podcast division to spice up its margins.
But Spotify’s return to near-record rankings has been a rocky road, and never with no slew of exits.
The company laid off 1,500 employees in December as a part of an enormous efficiency drive, with Ek arguing his employees were doing an excessive amount of “around work.” The company’s shares have continued to rise because the layoffs.
However, Ek acknowledged in the course of the company’s most up-to-date conference call that the layoffs, which represented 17% of the workforce, had impacted day-to-day operations greater than he had expected. This surprising adjustment was even partially accountable for the corporate’s failure to satisfy its high targets for monthly energetic users and quarterly profits.
