Earlier this year, about four months ago WhatsApp Co-founder, Jan Koum; announced his decision to leave Facebook and also step down from his position as a member of Facebook’s board of directors.
In 2014, Facebook shocked the world when it bought WhatsApp for $19 billion.
When Koum announced his plans to leave, there were reports that he could be losing out on as much as $1 billion if he leaves before his stock award fully vests.
After already selling about $7.1 billion worth of his shares in Facebook, it is clear that Koum knows what he’s doing. He has continued showing up to the office so as to collect one final lucrative payday: a massive $450 million in Facebook stock.
This is one of the examples of a Silicon Valley practice known as “resting and vesting”.
Koum’s Announcement in April
In Silicon Valley vocabulary, resting and vesting refer to when rich and wealthy entrepreneurs or engineers who are on their way out of a tech company, are allowed to stick around until their equity in the company is fully vested.
Silicon Valley’s act of resting and vesting is a culture that is real and can be described as an “open secret”.
An episode in the HBO show “Silicon Valley” mimicked this act; when engineers spent time relaxing and enjoying themselves on a roof without doing any work.
Vesting periods are typically four years after which the whole stock grant is given to the employee in question. Koum has only one vesting date left for the year which is scheduled for November.
The Wall Street Journal reported that Koum paid a visit to Facebook’s offices in mid-July. Which means that he has completed one requirement in his employment contract.
The Reason For The Spat
Koum’s decision to leave Facebook was reportedly due to a disagreement about data privacy and the messaging app’s business model. There were also reports that the spat had gone on for several months before he made his announcement.
Both Koum and his co-founder, Brian Acton (who left the company last year), are dedicated privacy advocates; who have always been concerned about the privacy and protection of the app’s users.
When they announced the sale of WhatsApp four years ago, they promised their users that their data would be preserved and never shared.
In 2016, WhatsApp doubled down on its pledge by adding encryption of user data in its services.
This makes Koum’s departure from the company quite unusual. The management and board of directors of the company have stayed faithful and committed; despite the scandals and troubles the company has gone through.
Koum is also the only founder of a startup acquired by Facebook who became part of the board members.
Ultimately, Koum and Acton were worn down by the differences in approach; their reasons for leaving Facebook are more ideological than financial.
