How much wealth is enough? For Evan Spiegel, co-founder of Snapchat (now Snap Inc.), apparently there is never enough. Not satisfied with being the youngest billionaire in in the United States—according to the 2016 Forbes 400 list of America’s richest people for the second year in a row—Spiegel is all set to rake in more money when his company goes public.
That’s right! Snap Inc. has announced its plan to go public, according to a regulatory filing on February 2, 2017. (Source: “Form S-1 Registration Statement,” U.S. Securities and Exchange Commission, February 2, 2017.)
According to Forbes, the Evan Spiegel net worth is currently around $4.0 billion, while Snapchat’s net worth is around $18.0 billion to $20.0 billion. This is likely to rise as Snapchat’s valuation increases. (Source: “The Guys Who Founded Snapchat – Now Snap – Are Worth $4 Billion Each,” Forbes, February 2, 2017.)
How Much Is Evan Spiegel Worth?
According to estimates, Spiegel is worth around $4.0 billion, thanks to his 22.4% stake in Snap Inc. Spiegel’s stake is based on the company’s share count as of December 30, 2016. This does not include additional restricted stock units (RSUs) or options that could be vested ahead of the company’s public offering.
As per the prospectus of the Snapchat IPO, Spiegel will receive another three-percent stake in Snap Inc. in the form of RSUs that will vest immediately after the completion of the public offering. This step has been taken and approved by the board of directors to motivate Spiegel to continue growing Snap toward an IPO. (Source: Ibid.)
Eager for Work Experience
Spiegel was born on June 4, 1990, in Los Angeles, California, to Melissa Ann Thomas and John W. Spiegel. Both of his parents are lawyers, and Evan Spiegel was raised in Pacific Palisades, California. He studied at the Crossroads School for Arts and Sciences in Santa Monica before entering Stanford University.
Spiegel had an enduring interest in design, and he took design classes at the Otis College of Art and Design while still in high school. Spiegel was hungry for work experience in the real world, so he worked as an unpaid intern at Red Bull, a paid intern for a biomedical company, a careers instructor in Cape Town, South Africa, and at Intuit Inc. (NASDAQ:INTU) on the “TxtWeb” project.
The Birth of Snapchat
In the vein of classic entrepreneurs, Spiegel left Stanford to focus on Snapchat in 2012, just before completing his degree. Earlier, while studying product design at Stanford, Spiegel had proposed Snapchat as a class project. Spiegel co-founded Snapchat along with Bobby Murphy and Reggie Brown and is currently Snapchat’s CEO.
Now Snapchat has around 160 million active daily users of its service. With the number of Internet users expected to increase in the future, there is no doubt that more people will use the Snapchat service. That will further increase Evan Spiegel’s net worth in the years to come.
Evan Spiegel and Snapchat IPO
Coming back to the Snapchat IPO, it is aiming to go public at a valuation of $20.0 billion to $25.0 billion. Spiegel is very likely to see a big increase in his net worth post the Snapchat IPO. When he gets his three-percent bonus, he will own 25.4% of Snap, which will raise his valuation to about $6.35 billion if Snap does reach its $25.0-billion target. The IPO is yet to happen, but what is Evan Spiegel’s current salary?
Spiegel’s annual base salary is $500,000.00, and he is also eligible for a yearly bonus. In 2016, Spiegel made around $2.4 million while, in 2015, he made around $1.7 million. This is primarily because of the $1.0-million bonus he received in both years. (Source: U.S. Securities and Exchange Commission, op cit.)
However, all this will change after the IPO. Spiegel’s annual salary will go down to $1.00, though he will continue to get an additional performance-based annual bonus of $1.0 million. This is keeping in tune with what some other big names have done. Mark Zuckerberg changed his annual salary to $1.00 after Facebook Inc (NASDAQ:FB) filed for an IPO, as did Google (now Alphabet Inc (NASDAQ:GOOG)) co-founder Sergey Brin.
Keeping one’s salary at $1.00 has become a trend these days, but Spiegel is doing it for a reason. It is a sign of his confidence in his company. Spiegel is hoping that his Snap stock will be worth so much after the IPO that he will no longer need a regular paycheck. This is crucial for Spiegel because, after the IPO, he might have to give up the bonus as well.
Snap’s IPO documents stipulate that “after our initial public offering, Mr. Spiegel will not be entitled to any bonus, except as may be determined by our board of directors.” (Source: “Snap CEO Will Get Paid as Much as Mark Zuckerberg After His IPO,” Fortune, February 3, 2017.)
However, if all goes well as expected, Evan Spiegel’s net worth will rise further.
Evan Spiegel Exploring New Ventures
The Snaptchat IPO is crucial for Spiegel, as he needs to push the product “Spectacles” and make it a winner. Spectacles are the company’s latest effort to reinvent the camera in the form of sunglasses that will allow users to take “Snaps.” Spectacles connect seamlessly with Snapchat and are the best way to make Snapchat “Memories” because they capture video from a human perspective. If Spectacles proves to be a success like Spiegel is hoping it will be, both Spiegel and Snap Inc’s net worth will surely rise.
Spiegel has used his money wisely so far. In November 2014, Spiegel bought his house in Brentwood for a healthy $3.3 million. Spiegel wants to get more involved in the music business as well. Snapchat might even launch its own record label. Spiegel is a big fan of music, and he often tweets about the music he is listening to. It is likely that Snap Inc may enter the music business in a big way. If that happens and Snap Inc strikes gold, Evan Spiegel’s net worth will surely increase.
All Eyes on Snap IPO
Spiegel already lives the life that most people can only dream of, and he knows it. However, Spiegel is humble, and he once said at a conference “I am a young, white, educated male. I got really, really lucky. And life isn’t fair.” No one doubts that Spiegel got this far by using his mind, working hard, and grasping the opportunity when it came his way.
With plans to enter the music business, making Spectacles successful, and the impending Snapchat IPO, chances are that Evan Spiegel’s net worth will further increase. Whether the IPO will be as successful as he hopes it will be, and whether the valuation will touch $25.0 billion, only time will tell. Until then, the youngest billionaire in America will be sleeping on a bed of thorns.