Zynga CEO Reduces Salary to Keep Top Employees
The former social game behemoth Zynga is offering larger salaries and bonuses to executives in 2013.
There was a time when social game creator Zynga seemed unstoppable. Everyone was playing Farmville and all the 'villes that came after it, and the company left and right [http://www.escapistmagazine.com/news/view/114505-Zynga-Officially-Values-Itself-at-1-Billion]. So how does a struggling developer hang onto its remaining top employees? In Zynga's case, the answer is simple: give them more money.
A form 8-K filed with the Securities and Exchange Commission showed that Zynga's bonuses for top executives were going to work differently in 2013, giving them the potential to earn even more money over the course of the year. As the form explains, "The Company's 2013 executive compensation program is designed to focus on two primary objectives: first, retaining and motivating our talented, entrepreneurial executive leadership team; and second, aligning our executive pay structure with company performance-based incentives. We believe that by focusing on both retention and performance, the compensation packages align with our strategy to build value for our stockholders."
As a result, the base salary for many of these execs has jumped up significantly. An example provided by Inside Social Games [http://www.insidesocialgames.com/2013/04/04/zynga-hopes-to-retain-top-executives-with-bigger-bonuses-tied-to-performance-mark-pincus-new-annual-salary-is-1/] is President of Games Steven Chiang, whose annual pay went from $300,0000 in 2012 to $500,000 in 2013. On top of that, Chiang now has the potential to earn $1.4 million in performance-based bonuses, as opposed to 2012's quarterly $100,000 bonuses. CEO Mark Pincus, on the other hand, has reduced his salary significantly; he'll earn $1 and no bonuses in 2013.
While Pincus' salary reduction seems extreme, desperate times call for desperate measures, and it's not hard to imagine why so many key executives are leaving Zynga. Between offered financial incentives [http://www.escapistmagazine.com/news/view/122186-EA-Zynga-Settle-The-Ville-Case-Out-of-Court] to keep employees from leaving. It seems unlikely that Zynga will be able to return to its billion-dollar glory days, but time will tell; perhaps hanging onto its remaining execs is exactly what the company needs to do in order to turn things around.
Source: Polygon [http://www.insidesocialgames.com/2013/04/04/zynga-hopes-to-retain-top-executives-with-bigger-bonuses-tied-to-performance-mark-pincus-new-annual-salary-is-1/]
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The former social game behemoth Zynga is offering larger salaries and bonuses to executives in 2013.
There was a time when social game creator Zynga seemed unstoppable. Everyone was playing Farmville and all the 'villes that came after it, and the company left and right [http://www.escapistmagazine.com/news/view/114505-Zynga-Officially-Values-Itself-at-1-Billion]. So how does a struggling developer hang onto its remaining top employees? In Zynga's case, the answer is simple: give them more money.
A form 8-K filed with the Securities and Exchange Commission showed that Zynga's bonuses for top executives were going to work differently in 2013, giving them the potential to earn even more money over the course of the year. As the form explains, "The Company's 2013 executive compensation program is designed to focus on two primary objectives: first, retaining and motivating our talented, entrepreneurial executive leadership team; and second, aligning our executive pay structure with company performance-based incentives. We believe that by focusing on both retention and performance, the compensation packages align with our strategy to build value for our stockholders."
As a result, the base salary for many of these execs has jumped up significantly. An example provided by Inside Social Games [http://www.insidesocialgames.com/2013/04/04/zynga-hopes-to-retain-top-executives-with-bigger-bonuses-tied-to-performance-mark-pincus-new-annual-salary-is-1/] is President of Games Steven Chiang, whose annual pay went from $300,0000 in 2012 to $500,000 in 2013. On top of that, Chiang now has the potential to earn $1.4 million in performance-based bonuses, as opposed to 2012's quarterly $100,000 bonuses. CEO Mark Pincus, on the other hand, has reduced his salary significantly; he'll earn $1 and no bonuses in 2013.
While Pincus' salary reduction seems extreme, desperate times call for desperate measures, and it's not hard to imagine why so many key executives are leaving Zynga. Between offered financial incentives [http://www.escapistmagazine.com/news/view/122186-EA-Zynga-Settle-The-Ville-Case-Out-of-Court] to keep employees from leaving. It seems unlikely that Zynga will be able to return to its billion-dollar glory days, but time will tell; perhaps hanging onto its remaining execs is exactly what the company needs to do in order to turn things around.
Source: Polygon [http://www.insidesocialgames.com/2013/04/04/zynga-hopes-to-retain-top-executives-with-bigger-bonuses-tied-to-performance-mark-pincus-new-annual-salary-is-1/]
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