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Ten-digit motivation:
Palantir boss Alex Karp
pocketed
$ 1.1 billion in 2020
Photo: Thibault Camus / AP
In order to motivate employees in the long term, companies are currently coming up with a few ideas: In addition to a salary increase, goodies such as a company bike, a comfortable chair for the home office or more flexible working hours can help keep employees on board.
But what if it's about company bosses who are supposed to be on duty for the company practically around the clock?
Who with their vision and persuasiveness should convince thousands of employees and investors that it is worthwhile to remain loyal to this company?
Then something more is needed than an office chair that is easy on the back.
And the data analysis company Palantir has set an example in terms of boss motivation.
Paydays for Palantir boss Karp from August
The compensation package that Palantir boss
Alexander Karp
(53) has pocketed for 2020
is worth around 1.1 billion dollars
. According to a report in the "Wall Street Journal", around $ 800 million in stock options and just under $ 300 million in stock awards, which are only granted after a certain period of time. The annual salary paid in cash to Karp, who is not only Palantir CEO but also co-founder of the company founded in 2004, is downright tiny at 1.1 million dollars. Karp's pay days will begin in August: 2.5 percent of the options and entitlements will then be paid out to him per quarter over a period of 10 years.
The data collection and analysis company Palantir is one of the most controversial companies in the US and has not made any profits since it was founded 17 years ago.
The valuation of the company, which went public in September 2020 via direct placement, is still around an incredible 50 billion dollars.
Compared to the reference price of US $ 7.25 set in September, the share price has now more than tripled - even though Palantir had explicitly stated in the prospectus that it would initially expect rising costs rather than profits.
With such a hype about a company, you need a boss with charisma who keeps the imagination of investors alive - no matter what the cost.
Motivate managers in the long term
Karp's annual salary of $ 1.1 billion justifies Palantir in a statement to the stock exchange regulator by saying that the remuneration is aimed at keeping the boss on board.
In addition, the remuneration linked to shares is a means of motivating the boss to continue to increase the value of the company in the years to come.
The food delivery service and stock market rookie Doordash, who granted his boss Tony Xu remuneration of around 400 million dollars for 2020 - also mainly in stock options, argues similarly.
In contrast to Doordash, the compensation of Palantir boss Karp is not tied to the share reaching a specific price target.
The only requirement was the successful IPO in September.
Karp is top earner in 2020 - but only third in the overall comparison
With his ten-figure annual income, Alex Karp is not even the top earner among US CEOs. So far, Tesla boss
Elon Musk
(50)
remains the lone front runner
, who received a compensation package worth 2.25 billion dollars for 2018. Musk's record package is also linked to the performance of the stock and the achievement of certain annual targets. In second place between Musk and Karp is Blackstone CEO
Stephen Schwarzman
(74), who received around $ 1.3 billion in compensation for 2008. The top trio of Karp, Schwarzman and Musk clearly stand out from the average: On average, the head of a company listed in the S&P 500 index earned around $ 13.4 million in 2020.
The head of the world's largest asset manager Blackstone should not be a role model for Alex Karp for several reasons: A few months after Schwarzman's payday, the global financial crisis began.
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