Snapchat went public almost a year ago and its hardworking employees have received a bucket load of bad news ever since, with the most recent blow coming in this week after it was announced that none of the employees will be able to get their hands on any cash bonuses since the company failed to meet its internal goals.
Meanwhile, the CEO of Snap Inc., Evan Spiegel, bagged a cool $637 million last year as a ‘motivational reward’ for all his hard work. Do you think the decision is fair to Snap Inc.’s employees?
Trouble in Paradise
Last week, the photo-sharing app asked its employees to fill out a survey in order to understand what motivates them and brings them joy at work. The broad range of questions answered anonymously were aimed at improving the company’s workplace environment – a trend that is being followed by many other big tech companies including Amazon.
On the outside, Snapchat seems to be doing remarkably well. Only last month, the company was successful in beating Wall Street’s projections which created a 47 per cent increase in its stock. However, the picture looks pretty grim internally. The company has taken a completely different stance on its marketing approach and redesigned the app to fare better against Facebook’s Instagram, which is its biggest competitor at the moment – but its efforts have only been met with criticism.
Intense Competition from Instagram
The photo-sharing app’s popularity has taken a tumble after key celebrities showed their preference for Instagram over it, making the shares plummeting to their IPO value and leaving the company with very little to celebrate. Despite beating Wall Street’s quarterly prediction, Snap Inc. believes that the company failed to meet its internal goals. As a result, the employees will have to do without any cash bonuses this year.
The decision was greeted with surprise – and criticism – since the company’s internal goals had more to do with the tightly-controlled business aspects defined by the CEO himself, rather than the performance of the employees. The sources who broke the news said that they wished to not be identified due to the company’s strict policies which discouraged the spread of internal information.
CEO Celebrates a Huge Payday
While the employees are left without cash bonuses this year, the company’s CEO took home a hefty bonus of $637 million last year. Concern is growing inside the company as workers are more and more convinced that the only shareholder that matters in Snap Inc. is the CEO Evan Spiegel himself.
As the stock prices for Snap came crashing down last year, the company has seen the departure of some of its top executives due to management clashes with the CEO who prefers to keep the majority of the voting power to himself and co-founder Bobby Murphy. It is speculated that the increasing employee and executive turnover could be hinting towards the company’s internal issues and fierce competition from Instagram.
Employees who have been in Snap’s internal meetings have reported Spiegel’s tough management style and preference for executives who are more accepting of his ideas. As rumors about Spiegel’s controlling nature continue to grow, the CEO’s PR team is making an effort to make it seem like the company is completely under the young entrepreneur’s control with very little regard for other people’s input and opinions.
Snapchat’s Murky Future
The company has begun to understand that the extreme hierarchy inside Snap could be affecting the employee performance and satisfaction which is why more surveys and question-answer sessions are being held in its various branches around the world. Spiegel has also made an active effort to gather leadership meetings with other executives and shareholders to discuss the current challenges faced by the company.
The compensation for Snap’s CEO last year was almost as much as what the company would make annually. In contrast, refusal to pay bonuses to employees is affecting their morale. Nevertheless, Snapchat’s plummeting stocks and decreasing popularity could only mean one thing: Spiegel may never get a payday as big as his last one again.