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Twitter reportedly using stock and bonuses to keep employees

The company has seen a number of executive leave, as its turnaround plan has yet to bear fruit

Financial trends and news by Steven Loeb
March 10, 2016
Short URL: http://vator.tv/n/43e2

Updated with comment from Twitter

There are two things that have been characterizing what's been happening at Twitter in the last few months: a falling stock price and an exodus of executives.

The two things may not be unrelated, since executives might own stock in the company, which is becoming increasingly less valuable, at least until Twitter is able to turn things around.

In the meantime, the company is taking steps to keep those employees, by giving them additional restricted stock, according to a report from the Wall Street Journal on Thursday.

The stock is said to have been given out companywide over the last month, and the amount that each employee gets depends on how long they've been working there. The longer their tenure, the more they get, in order "to make up for the value they lost since joining the company."

In addition, Twitter has also been giving employees bonuses, starting at $50,000 and going up to $200,000, in order to get them to stay another six months, or another year.

"Developing, retaining, and recruiting top talent is critical to Twitter’s business success and building shareholder value," a Twitter spokesperson told VatorNews when asked about this report.

This is the first time that the company has done something similar in just the last few months. In October of last year, after laying off 8 percent of Twitter's staff, Jack Dorsey announced that he was giving away roughly a third of his stake in Twitter "to our employee equity pool to reinvest directly in our people." The total value of the stake Dorsey gave away, which was about 1 percent of the company, came to $211 million.

That wasn't enough to keep many employees on board, though. 

In January a bunch of its executives quit en mass. They includes Katie Jacobs Stanton, the company’s VP of global media; Kevin Weil, it's SVP of product; Alex Roetter, who is and SVP of engineering; Jason Toff, general manager at Vine; and Brian “Skip” Schipper, Twitter's Vice President of Human Resources, all of whom chose to leave Twitter at the exact same time. 

Those departures followed Mike Davidson, Twitter's Head of Design, announced he was leaving the company in December. In the two weeks prior Twitter had also lost engineer Utkarsh Srivastava, who helped the company build its ads business, and it also saw the departure of Glenn Otis Brown, who has been heading up Twitter’s video ad program. Srivastava left for Google, while Brown went to Betaworks.

At the same time, Twitter's stock has continued to fall. It is down 23.68 percent year-to-date, as of Thursday's close, and is down 60 percent from where it was a year ago, mostly because it can't get its user growth started again.

Twitter actually did well in its quarter earnings, beating in EPS and matching in revenue, yet its stock tanked over 11 percent out of the gate. That's because user growth was either flat, or went down, depending on how you looked at it, not a good sign for a company that has had this same problem for two years now. 

Dorsey is trying really hard to get Twitter back on its feet, but his plans have yet to come to fruition. Keeping his staff happy, and in place, is just one part of that goal. 

(Image source: jenders.com)


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