Coinbase co-founder and CEO Brian Armstrong talking at TechCrunch Disrupt SF 2018.
Steve Jennings | Getty Images for TechCrunch
When Coinbase hits the general public market within the coming weeks, CEO Brian Armstrong is poised to rank among the many wealthiest folks in tech.
Armstrong, who co-founded the cryptocurrency trade in 2012 after working for a yr at Airbnb, owns 39.6 million Coinbase shares, between his Class A and Class B holdings. His stake is value $13.6 billion, primarily based on a mean personal market share worth this yr of $343.58, in accordance to the company’s updated prospectus.
Unlike most tech founders, Armstrong will probably be in a position to promote shares immediately after Coinbase goes public. That’s as a result of there is not any lock-up interval as half of Coinbase’s direct listing, which differs from an IPO in that the company would not elevate contemporary capital however as a substitute permits current shareholders to promote stock on the open market.
Assuming Coinbase’s personal buying and selling is indicative of the place the stock will open, Armstrong will develop into the most recent member of a rising group of tech “decabillionaires.” Headlined on the prime by Amazon’s Jeff Bezos, Tesla’s Elon Musk, Microsoft co-founder Bill Gates and Facebook’s Mark Zuckerberg, who’re all value over $100 billion, the listing of tech’s mega-rich has expanded considerably in recent times from surging valuations and new IPOs.
Zoom CEO Eric Yuan, who took his video chat company public in 2019, is value over $16 billion, in accordance to the Bloomberg Billionaires Index. Atlassian co-founders Scott Farquhar and Mike Cannon-Brookes are every value close to $14 billion, thanks to their company’s 2015 IPO and the stock’s subsequent run-up. Jack Dorsey’s internet value has ballooned previous $13 billion, principally as a result of of Square’s rally. Shopify CEO Tobi Lutke and Snap’s Evan Spiegel are each value over $10 billion.
Most of Armstrong’s wealth appreciation has come up to now yr or in order the worth of Coinbase’s stock in personal trades jumped greater than 10-fold. The company will get most of its income from the buying and selling and storage of bitcoin, which has soared greater than 700% up to now yr, and ethereum, which is up properly over 1,000%.
Bitcoin and ethereum over 12 months
CNBC
But Armstrong has been within the center of controversy as properly. In a blog post in September, Armstrong informed staff that, at a time when tensions have been excessive as a result of of the pandemic, protests for racial justice and a heated presidential election, Coinbase wouldn’t be a company centered on activism.
“The purpose is that whereas I feel these efforts are properly intentioned, they’ve the potential to destroy so much of worth at most corporations, each by being a distraction, and by creating inner division,” Armstrong wrote.
A pair months later, the New York Times ran an expose on Coinbase, detailing Black staff’ allegations of unfair therapy on the company, together with pay discrimination. Coinbase preemptively printed a blog post trying to refute the claims.
None of that has impaired the company’s progress, as personal trades reached file ranges in current weeks ahead of the direct itemizing. But Coinbase does acknowledge within the threat components part of its prospectus {that a} guess on the company is, no less than partially, a guess on Armstrong.
Hefty incentives
“Because we’re a founder-led company, actions by, or unfavorable publicity about, Brian Armstrong, our co-founder and Chief Executive Officer, might adversely affect our model and status,” the submitting says. “Such destructive publicity additionally may have an hostile impact on the scale and engagement of our clients and will end in decreased income, which may have an hostile impact on our enterprise, working outcomes, and monetary situation.”
Armstrong is closely incentivized to preserve the momentum going. He was paid a wage of $1 million final yr, although his whole compensation topped $59 million with all his choice awards.
In August, Armstrong was granted a multibillion-dollar efficiency award, giving him the flexibility to buy 9.29 million choices at $23.46 over 10 years. The awards are all primarily based on the company’s stock buying and selling at a sure worth for 60 days. Based on the personal market worth, roughly three-quarters of the award will vest in brief order. The highest tranche vests at $400.
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