Etsy Revival Boosts CEO Silverman's Options to $76 Million
(Bloomberg) -- Josh Silverman’s efforts to turn around Etsy Inc. are paying off for shareholders. They’ve also put the chief executive officer in line for his own windfall.
Silverman got 3.87 million options when he was named CEO in May. Since then, Etsy’s shares have almost tripled and were trading at $30.09 at 2:30 p.m. in New York. If he could exercise the options today, he’d net about $76 million, according to Bloomberg calculations. A quarter of the securities vest in May and the remainder over the next three years.
“Given our company’s changing circumstances in 2017, we recognized the need to develop competitive compensation packages to attract qualified candidates,” an Etsy spokeswoman said in an email. “This grant was purposefully front-loaded to provide Mr. Silverman with a meaningful equity stake in the company.”
Silverman, who helped turn around Skype a decade ago, was brought into Etsy as the New York-based online marketplace faced pressure from activist investors to reverse its slowing sales growth and flagging stock price. He’s emphasized boosting gross merchant sales -- the total amount of money made by all sellers across the platform -- while laying off employees and canceling the internship program.
The 2017 holiday quarter marked the first time Etsy logged more than $1 billion in gross merchant sales. Analysts expect the firm will report $120 million in revenue for the first quarter, which would be about a 20 percent increase from the prior year. Critics, including some of the firm’s sellers, worry Silverman is prioritizing profit over the company’s roots as a refuge from tough marketplaces like Amazon.com Inc.
For 2017, Silverman also received $247,159 in salary, a $400,000 bonus and $2.66 million in restricted stock, according to a regulatory filing Friday. He’s not eligible to get another equity award until 2021.
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