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The two execs fired were: - Kayvon Beykpour, Head of Consumer Product (3 years, 11 months) [1]; and - Bruce Falck, Revenue Product Lead (5 years at Twitter, 3

by jmyeet 5y ago

The two execs fired were: - Kayvon Beykpour, Head of Consumer Product (3 years, 11 months) [1]; and - Bruce Falck, Revenue Product Lead (5 years at Twitter, 3 years and 11 months in this position) [2] Kinda weird that both people were just shy of serving 4 years in their current roles. When I see moves like this my immediate thought is always, it's to save or make money. For example, there could be an options pool in the event of a change of control. Well, you've just fired a couple of people right before a huge vest (probably; I have no concrete information) and increased your share of that options pool. It just reminds me of Skype firing executives at the Microsoft buyout to avoid payouts [3]. Otherwise making these moves before an acquisition has closed doesn't make a lot of sense. My money is on this having everything to do with money. EDIT: Updated comment as the link was updated from the original Twitter thread by Kayvon Beykpour about his firing. [1]: https://www.linkedin.com/in/kayvon-beykpour-2b264b4?original_referer=https%3A%2F%2Fwww.google.com%2F https://www.linkedin.com/in/kayvon-beykpour-2b264b4?original... [2]: https://www.linkedin.com/in/brucefalck?original_referer=https%3A%2F%2Fwww.google.com%2F https://www.linkedin.com/in/brucefalck?original_referer=http... [3]: https://www.seattletimes.com/business/skype-fires-executives-avoiding-payouts-after-microsoft-buyout/#:~:text=Tony%20Bates%2C%20CEO%20of%20Skype,people%20familiar%20with%20the%20matter https://www.seattletimes.com/business/skype-fires-executives....

pikseladam 5y ago
wow. i think this is the true answer.
dang 5y ago
Ok, we'll change to that first link (submitted URL was https://twitter.com/kayvz/status/1524787801757126656 https://twitter.com/kayvz/status/1524787801757126656) - thanks!
mattmaroon 5y ago
If the moves were made at 11 months I'd agree. It'd be really unusual if there was some large vest at the 4 year mark. Unless maybe they've recently been granted something for retention.
- toyg 5y ago
  More likely they had initial vests at two years, then additional ones every extra year, on a rolling basis.
yuvadam 5y ago
Is it common to have huge vesting cliffs at senior management level at those time frames? This isn't some junior developer waiting for their 1 year cliff, even in that scenario options usually vest on a monthly basis after that.
wnevets 5y ago
Are there really no clauses in contracts or laws to prevent something like this? That sounds incredibly scummy.
- stingraycharles 5y ago
  I always understood that, while it’s frowned upon, it’s definitely allowed. It’s very scummy yes, but option plans are always a bit of a disguise trick, as it’s seen as part of your compensation, but in reality should really be considered a retroactive bonus you get after staying with the company for N years.
- ntkachov 5y ago
  That would be on the executive and the company to negotiate that aspect in the contract deal. Executive contracts almost always have lawyers behind them.
- deleted 5y ago
  [deleted]
- t_mann 5y ago
  Well, there are clauses saying after condition X is met you get Y. Clauses that would say you can't be fired up to Z days before you reach X are neither common, nor would they fundamentally fix the problem if you think about it. If you can prove that preventing bonus vesting was the reason you were let go, it might be worth talking to a lawyer, though - courts have the power in principle to intervene in such cases.
- jmyeet 5y ago
  There's a ton of scummy behaviour with things like this. Skype was particularly scummy. Not only were executives fired to avoid a payout, their options/shares were bought back at a low price (called a clawback agreement) and the company was incorporated in the Caymand Islands (IIRC) so suting them was going to be incredibly difficult. Mark Pincus of Zynga fame decided a bunch of people didn't deserve to get rich on the IPO so went to some people to get them agree to a smaller options package than they had in exchange for not being fired. These two fired suggests they didn't have clauses in their contracts for acceleration in the event of termination and/or they possibly had clauses that would give them a big payout. Or maybe it was just the timing to avoid a final vest (assuming a 4 year vest, which isn't a given). The two may even have grounds to sue so Twitter may have settled with them prior to this announcement for less than they would've had to pay out. This avoids litigation, the two exxecs get something and Twitter has to pay out less. Win, win, win (sort of).
jiveturkey 5y ago
maybe twitter accelerated their vest, or (at the exec level) there's a clause for that in their agreement. i'd lean that way before i considered this is a money saving move.
dymk 5y ago
The vesting / payout theory makes no sense, firstly Twitter vesting at that point would be quarterly, so the company would be saving at most 1/16th of what those employees had already vested from their initial grant. Secondly, it's the employees who would have the incentive to leave, not the company to fire them. Assuming a typical 4 year vesting period, it's right at this year when their compensation would have _dropped precipitously_. Thirdly, the second individual had been at Twitter for more than 4 years, and unless they left and came back (doesn't look like they did), they'd still be vesting their original equity grant. The amount of time they've been at the company isn't even common between the two, so I don't see why you'd use it to establish a theory.
- throwaway_1928 5y ago
  This may be Parag's hail mary play to appease his new master and keep his lucrative job. I would not be surprised if his next move is to publicly extol the virtues of Free Speech and the First Amendment.
  - enos_feedler 5y ago
    Thats what I was thinking too. It felt weird that Dorsey was replaced with such quiet low profile thinker in the first place. He has no presence on earnings calls or spaces. I’ve listened to him take questions and he seems to handle them no better with no deeper insight then even I could provide. Maybe he was keeping things close to his chest. However, it just made me think they sort of put a puppet in charge for the purpose of acquisition. Parag would be easy to control as a lever into change within Twitter. Attractive feature for a buyer. I thought it would be big tech. Never thought Elon would be the one buying and controlling him. What a plot twist!
  - partiallypro 5y ago
    There is basically no way that Musk keeps him on, so I don't buy this. He will be replaced in due time once the acquisition is complete.
    - johannes1234321 5y ago
lmkg 5y ago
Aside from that 3.93 is slightly less than 4, it's odd that both employees were in their current position for the same amount of time. I.e. they were part of the same cohort. What was Twitter doing in June-ish 2018 that resulted in them hiring multiple people in key roles? Was there an expansion, or a re-org, or executive turn-over? Or just overfitting two data points?
- deleted 5y ago
  [deleted]
- arthurcolle 5y ago
  That's when the Chik-fil-a "scandal" happened https://www.washingtonpost.com/news/on-leadership/wp/2018/06/11/square-ceo-jack-dorsey-gets-blasted-from-both-sides-after-a-tweet-about-chick-fil-a/ https://www.washingtonpost.com/news/on-leadership/wp/2018/06...
- tmp_anon_22 5y ago
  > What was Twitter doing in June-ish 2018 I think your timeline is off, wouldn't executive hires have a much longer timeline from inception to close such that the "event" predicating their hires could have been 5 years, 6 years out?
jollybean 5y ago
No, this is not about 'a few options'. They are about to transform the company - and they need the talent to do that. It's difficult to tell, but it could be that these guys are scapegoats, or they are going to be stumbling blocks to the 'new approach', or they company wants fresh blood there, or might have fresh blood lined up. Whatever this is - it's in the domain of 'strategic', not likely to due to someone's equity package.
Simon_O_Rourke 5y ago
All of these higher up executive firings do nothing but remind me of those lines in Goodfellas "we had to sit still and take it. It was among the Italians. It was real grease ball s*t."

by jmyeet 5y ago

pikseladam 5y ago

wow. i think this is the true answer.

dang 5y ago

Ok, we'll change to that first link (submitted URL was https://twitter.com/kayvz/status/1524787801757126656 https://twitter.com/kayvz/status/1524787801757126656) - thanks!

mattmaroon 5y ago

If the moves were made at 11 months I'd agree. It'd be really unusual if there was some large vest at the 4 year mark. Unless maybe they've recently been granted something for retention.

toyg 5y ago
More likely they had initial vests at two years, then additional ones every extra year, on a rolling basis.

yuvadam 5y ago

Is it common to have huge vesting cliffs at senior management level at those time frames? This isn't some junior developer waiting for their 1 year cliff, even in that scenario options usually vest on a monthly basis after that.

wnevets 5y ago

Are there really no clauses in contracts or laws to prevent something like this? That sounds incredibly scummy.

stingraycharles 5y ago
I always understood that, while it’s frowned upon, it’s definitely allowed. It’s very scummy yes, but option plans are always a bit of a disguise trick, as it’s seen as part of your compensation, but in reality should really be considered a retroactive bonus you get after staying with the company for N years.
ntkachov 5y ago
That would be on the executive and the company to negotiate that aspect in the contract deal. Executive contracts almost always have lawyers behind them.
deleted 5y ago
[deleted]
t_mann 5y ago
Well, there are clauses saying after condition X is met you get Y. Clauses that would say you can't be fired up to Z days before you reach X are neither common, nor would they fundamentally fix the problem if you think about it. If you can prove that preventing bonus vesting was the reason you were let go, it might be worth talking to a lawyer, though - courts have the power in principle to intervene in such cases.
jmyeet 5y ago
There's a ton of scummy behaviour with things like this. Skype was particularly scummy. Not only were executives fired to avoid a payout, their options/shares were bought back at a low price (called a clawback agreement) and the company was incorporated in the Caymand Islands (IIRC) so suting them was going to be incredibly difficult. Mark Pincus of Zynga fame decided a bunch of people didn't deserve to get rich on the IPO so went to some people to get them agree to a smaller options package than they had in exchange for not being fired. These two fired suggests they didn't have clauses in their contracts for acceleration in the event of termination and/or they possibly had clauses that would give them a big payout. Or maybe it was just the timing to avoid a final vest (assuming a 4 year vest, which isn't a given). The two may even have grounds to sue so Twitter may have settled with them prior to this announcement for less than they would've had to pay out. This avoids litigation, the two exxecs get something and Twitter has to pay out less. Win, win, win (sort of).

jiveturkey 5y ago

maybe twitter accelerated their vest, or (at the exec level) there's a clause for that in their agreement. i'd lean that way before i considered this is a money saving move.

dymk 5y ago

The vesting / payout theory makes no sense, firstly Twitter vesting at that point would be quarterly, so the company would be saving at most 1/16th of what those employees had already vested from their initial grant. Secondly, it's the employees who would have the incentive to leave, not the company to fire them. Assuming a typical 4 year vesting period, it's right at this year when their compensation would have _dropped precipitously_. Thirdly, the second individual had been at Twitter for more than 4 years, and unless they left and came back (doesn't look like they did), they'd still be vesting their original equity grant. The amount of time they've been at the company isn't even common between the two, so I don't see why you'd use it to establish a theory.

throwaway_1928 5y ago
This may be Parag's hail mary play to appease his new master and keep his lucrative job. I would not be surprised if his next move is to publicly extol the virtues of Free Speech and the First Amendment.
- enos_feedler 5y ago
  Thats what I was thinking too. It felt weird that Dorsey was replaced with such quiet low profile thinker in the first place. He has no presence on earnings calls or spaces. I’ve listened to him take questions and he seems to handle them no better with no deeper insight then even I could provide. Maybe he was keeping things close to his chest. However, it just made me think they sort of put a puppet in charge for the purpose of acquisition. Parag would be easy to control as a lever into change within Twitter. Attractive feature for a buyer. I thought it would be big tech. Never thought Elon would be the one buying and controlling him. What a plot twist!
- partiallypro 5y ago
  There is basically no way that Musk keeps him on, so I don't buy this. He will be replaced in due time once the acquisition is complete.
  - johannes1234321 5y ago

lmkg 5y ago

Aside from that 3.93 is slightly less than 4, it's odd that both employees were in their current position for the same amount of time. I.e. they were part of the same cohort. What was Twitter doing in June-ish 2018 that resulted in them hiring multiple people in key roles? Was there an expansion, or a re-org, or executive turn-over? Or just overfitting two data points?

deleted 5y ago
[deleted]
arthurcolle 5y ago
That's when the Chik-fil-a "scandal" happened https://www.washingtonpost.com/news/on-leadership/wp/2018/06/11/square-ceo-jack-dorsey-gets-blasted-from-both-sides-after-a-tweet-about-chick-fil-a/ https://www.washingtonpost.com/news/on-leadership/wp/2018/06...
tmp_anon_22 5y ago
> What was Twitter doing in June-ish 2018 I think your timeline is off, wouldn't executive hires have a much longer timeline from inception to close such that the "event" predicating their hires could have been 5 years, 6 years out?

jollybean 5y ago

No, this is not about 'a few options'. They are about to transform the company - and they need the talent to do that. It's difficult to tell, but it could be that these guys are scapegoats, or they are going to be stumbling blocks to the 'new approach', or they company wants fresh blood there, or might have fresh blood lined up. Whatever this is - it's in the domain of 'strategic', not likely to due to someone's equity package.

Simon_O_Rourke 5y ago

All of these higher up executive firings do nothing but remind me of those lines in Goodfellas "we had to sit still and take it. It was among the Italians. It was real grease ball s*t."