In the business world, you might not always be able to guess who's making the most money judging from who gets the most headlines. Take Jeff Green, the CEO of an advertising tech company called The Trade Desk. He’s not exactly a household name, and he doesn’t have a tendency to take any trips to space or pay cash for social media platforms, yet he was the highest paid CEO in the world last year, with a staggering pay package totaling $830 million.
Jeff Green's Remarkable Compensation Structure
Most of that pay package is in the form of stock options that will vest in eight predetermined "batches" depending on the company's future stock performance. If the company’s stock market value rises significantly over the next decade, the shares could become worth billions. A spokesperson for the company explained the rationale behind this structure, stating: “These are performance-based options, which vest at ambitious price targets…We have heard from our major investors that they are very supportive of this grant, as they stand to benefit significantly if these price thresholds are met.”
Green could already exercise his first batch of stock options, reportedly 2.4 million shares, but he has not done so yet. He has spent a reported $14.1 million to exercise options valued at almost $53 million, but these were older options not included in the most recent pay package. This strategy of waiting to exercise options is a calculated move that reflects his confidence in the company's future performance.
Potential Earnings from Performance-Based Options
Should all seven of the package’s stock market benchmarks be met by the company, Green could eventually stand to make anywhere from $1.8 billion to $5.2 billion worth of new shares. This staggering potential reflects the high-stakes nature of executive compensation in the tech industry. While the bulk of Green’s pay is in stock options, he’s still receiving a salary from Trade Desk.
For 2021, his salary was $965,000, along with a discretionary bonus of $1 million, an "annual incentive payment" of $2.7 million in cash, and $1.9 million in company-paid taxes. However, these figures pale in comparison to the wealth he could amass if he successfully guides The Trade Desk into a prosperous future.
Green's Public Image and Philanthropic Commitments
Jeff Green might not be familiar to the general public but he did receive some attention last year when he formally cut ties with the Church of Jesus Christ of Latter-day Saints over what he called their "hindrance of civil rights." This decision highlighted his commitment to social issues, which may resonate with many individuals today.
At the same time, Green also pledged to give at least 90 percent of his wealth—potentially a massive sum depending on the future performance of Trade Desk—to charity. This commitment to philanthropy emphasizes the importance of giving back, especially for someone in his financial position.
Insights from Jeff Green's Interview
In an interview Jeff gave to CNBC’s "Mad Money" host Jim Cramer in July 2021, he discussed his vision for The Trade Desk and the strategic decisions that led to its impressive growth. His insights provide valuable lessons on leadership, resilience, and the significance of aligning corporate strategies with social values.
Understanding Green’s journey and approach can inspire future business leaders and entrepreneurs. His dedication to performance-based compensation schemes and philanthropic efforts serves as a reminder of the broader impact that successful individuals can have on society.
