Workplace

Zoom gave employees stock to stay during the pandemic. It's turned into a windfall.

Zoom's skyrocketing share price turned into a great payday for the videoconferencing employees who stuck around.

Zoom home screen

In the U.S., Zoom gave out 450 RSUs, or restricted stock units, to employees.

Photo: Bloomberg/Getty Images

In June 2020, Zoom had just finished the craziest quarter of its business. While some companies had handed out office stipends or extra time off, Zoom took it a step further. Last summer it gave every employee a special stock grant, with the exception of Zoom's CEO Eric Yuan, who declined the award.

For U.S. employees, the value was worth roughly $63,000, according to an SEC filing. But thanks to Zoom's stock boom as the pandemic dragged on, the value of those shares has nearly tripled, and are worth around $171,000 today.

The goal of the special stock grant was to reward employees who had been under intense pressure during the pandemic, and also to convince them to stick around during a critical time for the business, the SEC filing states.

At the time, the value of the 450 shares granted to U.S. employees was around 60% of U.S. employees' average base salaries, the company said in filings. (Other Zoom geographies received different numbers of shares.)

But Zoom's stock has been on a tear as the videoconferencing company saw tremendous growth in 2020 and became a household name during the pandemic. Its stock price reached a peak of around $568 in October 2020 before settling around $380 for the last few weeks. And with the ballooning stock price, the retention award bonus has swelled too.

In the U.S., Zoom gave out 450 RSUs, or restricted stock units, to employees. Unlike options, which give employees a right to buy stock for a lower stock price, RSUs convert to shares whenever certain conditions are met. As part of the Zoom bonus terms, the stock vests over two years in two chunks, so employees had to have stayed through this past June to get the first half of the 450 shares, and will need to remain with Zoom until June 8, 2022 for the second half. So last month, U.S. employees at Zoom who had stuck around for a year received the first tranche of 225 shares from the award, valued on June 8 at around $76,000 — more than the entire award's initial target value.

It's a unique form of "golden handcuffs" to incentivize that workforce to stick around, while also being a tremendous reward for those who did. Retention bonuses aren't uncommon in the tech industry, but they're typically targeted at specific executives or toward employees after an acquisition so they stick around at the new company. For example, when Walmart bought Jet.com, Marc Lore reportedly received RSUs worth more than $250 million, but the five-year vesting schedule was backloaded so that it only vested 10% in the first year compared to 30% in five. (He lasted 4 and a half years before leaving in January 2021.) When Facebook executive Chris Cox rejoined as its chief product officer, the company awarded him an extra $4 million on top of his $69 million signing bonus to stick around for a year.

What makes the Zoom award unique is that it wasn't just about convincing employees to stay, but to reward them for keeping the world connected at the start of the pandemic. The bonus was meant as a thank you to the employees, and in the end, the Zoom bonus was worth a lot more than the average home office stipend or days off most tech companies gave out.

Enterprise

Why software releases should be quick but 'palatable and realistic'

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LaunchDarkly was founded in 2014 to help companies manage the software release cycle.

Photo: LaunchDarkly

Gone are the days of quarterly or monthly software update release cycles; today’s software development organizations release updates and fixes on a much more frequent basis. Edith Harbaugh just wants to give business leaders a modicum of control over the process.

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Tom Krazit

Tom Krazit ( @tomkrazit) is Protocol's enterprise editor, covering cloud computing and enterprise technology out of the Pacific Northwest. He has written and edited stories about the technology industry for almost two decades for publications such as IDG, CNET, paidContent, and GeekWire, and served as executive editor of Gigaom and Structure.

COVID-19 accelerated what many CEOs and CTOs have struggled to do for the past decade: It forced organizations to be agile and adjust quickly to change. For all the talk about digital transformation over the past decade, when push came to shove, many organizations realized they had made far less progress than they thought.

Now with the genie of rapid change out of the bottle, we will never go back to accepting slow and steady progress from our organizations. To survive and thrive in times of disruption, you need to build a resilient, adaptable business with systems and processes that will keep you nimble for years to come. An essential part of business agility is responding to change by quickly developing new applications and adapting old ones. IT faces an unprecedented demand for new applications. According to IDC, by 2023, more than 500 million digital applications and services will be developed and deployed — the same number of apps that were developed in the last 40 years.[1]

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Denise Broady, CMO, Appian
Denise oversees the Marketing and Communications organization where she is responsible for accelerating the marketing strategy and brand recognition across the globe. Denise has over 24+ years of experience as a change agent scaling businesses from startups, turnarounds and complex software companies. Prior to Appian, Denise worked at SAP, WorkForce Software, TopTier and Clarkston Group. She is also a two-time published author of “GRC for Dummies” and “Driven to Perform.” Denise holds a double degree in marketing and production and operations from Virginia Tech.
Workplace

Building an antiracist company: From idea to practice

Twilio’s chief diversity, inclusion and belonging officer says it’s time for a new approach to DEI.

“The most impactful way to prioritize DEI and enable antiracism is to structure your company accordingly,” says Twilio’s head of DEI Lybra Clemons.

Photo: Twilio

Lybra Clemons is responsible for guiding and scaling inclusion strategy and diversity initiatives at Twilio.

I’ve been in the corporate diversity, equity and inclusion space for over 15 years. In that time, I’ve seen the field evolve slowly from a “nice-to-have” function of Human Resources to a rising company-wide priority. June 2020 was different. Suddenly my and my peers’ phones started ringing off the hook and DEI leaders became the most sought-after professionals. With so many DEI roles being created and corporate willingness to invest, for a split second it looked like there might be real change on the horizon.

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Lybra Clemons
Lybra S. Clemons is a seasoned C-suite executive with over 15 years of Human Resources, Talent and Diversity & Inclusion experience at Fortune 500 companies. She is responsible for guiding and scaling inclusion strategy and diversity initiatives across Twilio's global workforce. Prior to Twilio, Lybra was global head of Diversity & Inclusion at PayPal, where she managed and oversaw all global diversity initiatives. Lybra has held critical roles in Diversity & Inclusion with Morgan Stanley, The Brunswick Group and American Express. She serves on the board of directors of Makers and How Women Lead Silicon Valley Executive Board of Advisers, and has been recognized by Black Enterprise as one of the Top Corporate Women in Diversity.
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Can Matt Mullenweg save the internet?

He's turning Automattic into a different kind of tech giant. But can he take on the trillion-dollar walled gardens and give the internet back to the people?

Matt Mullenweg, CEO of Automattic and founder of WordPress, poses for Protocol at his home in Houston, Texas.
Photo: Arturo Olmos for Protocol

In the early days of the pandemic, Matt Mullenweg didn't move to a compound in Hawaii, bug out to a bunker in New Zealand or head to Miami and start shilling for crypto. No, in the early days of the pandemic, Mullenweg bought an RV. He drove it all over the country, bouncing between Houston and San Francisco and Jackson Hole with plenty of stops in national parks. In between, he started doing some tinkering.

The tinkering is a part-time gig: Most of Mullenweg’s time is spent as CEO of Automattic, one of the web’s largest platforms. It’s best known as the company that runs WordPress.com, the hosted version of the blogging platform that powers about 43% of the websites on the internet. Since WordPress is open-source software, no company technically owns it, but Automattic provides tools and services and oversees most of the WordPress-powered internet. It’s also the owner of the booming ecommerce platform WooCommerce, Day One, the analytics tool Parse.ly and the podcast app Pocket Casts. Oh, and Tumblr. And Simplenote. And many others. That makes Mullenweg one of the most powerful CEOs in tech, and one of the most important voices in the debate over the future of the internet.

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David Pierce

David Pierce ( @pierce) is Protocol's editorial director. Prior to joining Protocol, he was a columnist at The Wall Street Journal, a senior writer with Wired, and deputy editor at The Verge. He owns all the phones.

China

Why China is outselling the US in EVs 5 to 1

Electric cars made up 14.8% of Chinese car sales in 2021, compared with 4.1% in the U.S.

Passenger EV sales in China in 2021 jumped 169.1% to nearly 3.3 million from a year ago.

Photo: VCG/VCG via Getty Images

When Tesla entered China in 2014, the country’s EV market was going through a reset. The Austin, Texas-based automaker created a catfish effect — a strong competitor that compels weaker peers to up their game — in China’s EV market for the past few years. Now, Tesla’s sardine-sized Chinese competitors have grown into big fishes in the tank, gradually weakening Tesla’s own prominence in the field.

2021 was a banner year for China’s EV industry. The latest data from the China Passenger Car Association shows that total passenger EV sales in China in 2021 jumped 169.1% from a year ago to nearly 2.99 million: about half of all EVs sold globally. Out of every 100 passenger cars sold in China last year, almost 15 were so-called "new energy vehicles" (NEVs) — a mix of battery-electric vehicles and hybrids.

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Shen Lu

Shen Lu covers China's tech industry.

SKOREA-ENTERTAINMENT-GAMING-MICROSOFT-XBOX
A visitor plays a game using Microsoft's Xbox controller at a flagship store of SK Telecom in Seoul on November 10, 2020. (Photo by Jung Yeon-je / AFP) (Photo by JUNG YEON-JE/AFP via Getty Images)

On this episode of the Source Code podcast: Nick Statt joins the show to discuss Microsoft’s $68.7 billion acquisition of Activision Blizzard, and what it means for the tech and game industries. Then, Issie Lapowsky talks about a big week in antitrust reform, and whether real progress is being made in the U.S. Finally, Hirsh Chitkara explains why AT&T, Verizon, the FAA and airlines have been fighting for months about 5G coverage.

For more on the topics in this episode:

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David Pierce

David Pierce ( @pierce) is Protocol's editorial director. Prior to joining Protocol, he was a columnist at The Wall Street Journal, a senior writer with Wired, and deputy editor at The Verge. He owns all the phones.

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