In mid-November, one Doordash share was worth just under $246. Today, it’s worth about $108.
Doordash stock has taken a massive tumble in the new year, and that’s hurting employees’ pocketbooks and retirement plans. According to an internal memo obtained by Business Insider, Doordash plans to offer employees who joined after the 2020 IPO “top-up” equity grants to offset the losses.
“Over the past year, we’ve seen significant differences in the value of equity compensation driven by someone’s start date and the volatility in our stock price,” the memo reads. “Going forward, we are designing a compensation program to ensure that performance is what drives differences in pay — even in the face of stock volatility.”
According to compensation comparison tool levels.fyi, equity makes up anywhere from 23.3% to 55.5% of a software engineer’s total compensation at the company, where 6.25% of stocks vest on a quarterly basis. That’s similar to what employees in similar roles are paid at competitors like Instacart and UberEats, but a slightly higher proportion of equity compared to Big Tech firms like Google and Meta.
Doordash is among a slew of tech stocks that have taken a tumble in the first quarter of the year. Shopify, for example, will increase employee base pay starting in July, after shares have fallen more than 60% since November. It’s also giving employees more flexibility between stock and cash options, according to The Globe and Mail. When Instacart’s valuation fell, the company adjusted an internal accounting measure so that employees were essentially gaining shares at a lower price. Robinhood, Snap, Roku and Uber have also offered increased equity to employees.
According to Pitchbook, the slump is hitting early-stage startups, too. In a survey of VC funding in Q1 of 2022, it found that VCs only invested $70.7 billion over the past three months — the lowest quarter since 2020 — with very few companies choosing to IPO. In contrast to the IPO and SPAC flurry last year, Pitchbook said that poor public market performance is influencing the change in startup funding, too.