It's been a huge three weeks for Twitter co-founder and chief executive Jack Dorsey.
On Oct. 5, Twitter's board removed the "interim" from his title, confirming reports he would be chief executive and ending months of speculation over who would helm the social media service. Since then, Dorsey has made headlines for not earning a salary or taking a new bonus or additional stock compensation in his new role. The company has launched a big new element of the service, the news-via-Twitter feature "Moments," named a new chairman of the board, apologized to developers and announced it was cutting more than 300 workers (8 percent of the company's staff).
Oh, and amid all this, Dorsey filed the paperwork to take public the other company he founded and runs, the mobile payments company Square.
Dorsey capped off this mad flurry of news with a tweet Thursday night saying he is giving one-third of his Twitter stock, or one percent of the company, "to our employee equity pool to reinvest directly in our people." The shares are equal to about $200 million. “I’d rather have a smaller part of something big than a bigger part of something small,” Dorsey said in a subsequent tweet. “I’m confident we can make Twitter big!”
Dorsey's most recent effort may be an attempt to help increase employee morale after last week's job cut news, or, as Bloomberg News noted, grow the pool of shares that can be used to pay employees without diluting the stock. It's a rare move, though there have been a few recent stories of CEOs foregoing a bonus or giving away their own shares or profits from selling the company.
The chief executive of a Turkish food delivery company paid out $27 million to 114 employees this summer after selling the firm. In July, Bobby Frist, the nephew of former U.S. Senate Majority Leader Bill Frist, gave $1.5 million of his own shares to 600 employees of the Nashville-based health care company he runs. Dan Price, the founder of Seattle-based Gravity Payments, made headlines for using his $1 million salary (as well as company profits) to fund raises for every employee in his company to at least $70,000. In 2013, Lenovo CEO Yang Yuanqing gave $3.25 million of his $4.23 million bonus to hourly employees.
But something on the scale of $200 million is really quite rare. Whether the move is designed to add to the shock-and-awe of the last few weeks before next week's earnings report, increase employee morale in the aftermath of announcing layoffs or pay employees with equity--the gold standard in Silicon Valley currency--without diluting the value of other shares, one thing's for sure. Dorsey's move to give away such a big chunk of his own stock helps boost and expand the argument that's been made repeatedly about Twitter that a founder can do things for this company that other CEOs could not.