After Reddit decided to file paperwork in February to go public as a company, it was revealed that its CEO Steve Huffman received $193 million in total compensation for 2023, and some Reddit users weren’t happy about it.
Users on the platform criticized the CEO’s million-dollar payout for 2023 claiming that it was unusually massive.
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Huffman has now hit back at users criticizing his compensation package last year. In a Q&A on the company’s platform, he claimed that his compensation is a mix of salary and stock. He also said that his compensation is tied to his performance.
“The board evaluates my performance and sets my compensation,” he said. “So, the way the board thinks about my stock ownership is as a percent ownership of the company. So, while I’m a founder of Reddit, I also sold my stake a long time ago, and I was rehired and have to re-earn my ownership.”
Huffman said that he currently owns 3.2% of Reddit, and that his large compensation for 2023 is the result of the board choosing to “simplify things.”
“Why does it look like I got a big grant at the end of 2023? Because the board canceled most of my outstanding grants and then re-granted them,” said Huffman. “And they did this to simplify things for both the company and me and align my performance with the company’s performance.”
According to an SEC filing, Huffman’s salary for 2023 was $341,346. He also received $98,332,716 in stock awards, $93,776,049 in option awards, $792,000 in non-equity incentive plan compensation and $7,375 in “all other compensation,” which all totals to $193,249,486 for the year.
“Some of the stock vests at IPO. Some vests over time. And some isn’t worth anything until the value of the company increases,” said Huffman. “So, if the company does well, I will do well, but if the company does not do well, I don’t either.”
The average salary of a CEO in the United States is $834,479, with a range that is between $630,589 and $1,075,177, according to recent estimates from Salary.com
Reddit is expected to make its initial public offering at the New York Stock Exchange on March 21 with the ticker RDDT. Its IPO is reportedly between four and five times oversubscribed, according to a recent report from Reuters, this shows that investors are eager to purchase the company’s shares.
The report also notes that Reddit is allegedly aiming for a price range of $31 to $34 per share and a valuation of $6.5 billion.
