[mythz]

So SNAP lays off another 7% of their workforce to save $34M a year whilst their CEO pockets $638M in compensation (3rd highest CEO payout ever) before they're remotely close to profitability. Not sure if company-wide layoffs and paying their CEO more are going to achieve their growth/profitability aspirations.

[pjc50]

The logical conclusion of today's corporate structure is a company with a single employee, the CEO, who is paid all the profits, while all the actual labour is performed by zero-hour sub-minimum-wage contractors, all either funded by VC money or floated but posting zero dividends.

[jobigoud]

If the service can be implemented as a decentralized autonomous corporation running on a Blockchain you might not even need the CEO.

[maxxxxx]

Who can then pocket all the money?

[pjc50]

The first person to find an exploit in the smart contract, like a juicy bug pinata.

[lukewrites]

The GPs at the venture funds, just like nature intended.

[maxxxxx]

"just like nature intended."

:)

[justinzollars]

The Smart Contract.

[swyx]

he was paid by his board to IPO the company so the VC's could liquidate.

They seem like the smart money here.

[gameswithgo]

And these CEOs, on average, shovel money politicians to pay less and less taxes and kill more and more programs that would help those that are laid off.

Wonder how long the american proletariat will accept that?

[adventured]

You're conflating two very different things as it pertains to their actual business.

The CEO compensation is coming from diluting shareholders, he's receiving stock compensation there. That $638m doesn't cost them cash. Is it morally obnoxious to be rewarding an outsized pay package on a business that is financially struggling to survive? Of course, it's reprehensible in my opinion, however that value judgment is entirely subjective in nature. What kind of business rewards huge stock compensation plans while accelerating toward a brick wall of insolvency?

What's not subjective, is cash going out the door and being unable to keep the lights on.

Snapchat firing employees improves their extremely bad cash burn situation. That's why they're doing it. In about five or six quarters at the current rate of burn, Snapchat will be in dire condition from a cash position, which will threaten their ability to continue as an operating business. That's especially true if growth doesn't dramatically pick up soon. When they hit seven or eight quarters out, they're on bankruptcy watch unless they raise a lot of capital or slash expenses deep (they could obviously sell the business as well).

[icebraining]

I don't see how they are "very different things". That stock has a monetary value, does it not?

They could offer it to their employees in exchange for a salary reduction totaling those $34M/year.

Alternatively, they could have sold that stock.

Or taken a loan using that stock as collateral.

[andromedaworld]

> They could offer it to their employees in exchange for a salary reduction totaling those $34M/year.

It doesn't really matter. If the business is unsustainable then all such moves won't cut it anyway. Businesses typically lay people off when things aren't going well, and things aren't going well for snap.

They could pay them that money today but what about tomorrow?

[aylmao]

In theory $34M/year worth of employees should help you build a stronger company that would make $34M more next year.

In practice though, maybe Snap just can't grow that fast. Which is fine, but it's still sad that 220 people lost their jobs.