Now that Snap has published details of its business operations as part of its plans to become a public company, we are learning all sorts of things about the company and its 26-year-old founder CEO, Evan Spiegel.
For instance, in addition to rewarding Spiegel with a 2016 salary of $500,000 and a $1 million bonus, the company was amenable to loaning him millions of dollars, not just once but twice.
In 2014, Snap loaned Spiegel $5 million, and loaned cofounder Robert Murphy the same amount.
And a year ago, in February, when the value of his company’s shares had already made him a paper billionaire, the company loaned Spiegel another $15 million.
And in September 2016, the company bought $8.1 million of shares from Spiegel, at of $30.72 per share. He repaid both loans in full by the end of September, just seven months after he took out the $15 million loan.
At that time, Murphy also sold $8.1 million in shares to the company, and paid back his $5 million loan, too.
Selling their stock didn’t impact their control of the company. Not only do each of them still own about 22% of the Class A common stock, 2% of the Class B, they each own 50% of the Class C stock. All told the founders retain more than 44% of the voting power in the company apiece, the SEC documents show.
As to what Spiegel did with the cash in 2016, that was not disclosed in the filing (nor would we expect it to be). However, in May, 2016, he and his girlfriend supermodel Miranda Kerr, bought a 7,164-square-foot house for $12 million. The house had been owned by Harrison Ford. They got engaged a month later.
And back in 2014, the company famously settled a lawsuit with by its ousted co-founder, Reggie Brown, for an undisclosed sum. If the co-founders were on the hook to pay any of that money from their own holdings, a loan from the company would probably be a reasonable way to go about it.
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