February 4, 2022 • 16 mins
This just in: A guy asked for a billion-dollar bonus. Late-breaking reports (from last week) indicate that it went...poorly. As always, The Busyness Paradox is nowhere near the action, bringing you our on-the-spot analysis of this ballsy Bolivian billionaire's brash beatdown (fine, "Bolivian-American" but we had a good thing going with that alliteration).
Mentioned in this "breaking news" episode:
Masayoshi Son - Founder, CEO and Chairman of SoftBank, CEO of Softbank Mobile
Marcelo Claure - CEO of SoftBank Group International, COO of SoftBank Group Corporation (please don't ask us what all these different SoftBanks are all about)
12:20 - Episode 13: We Put the Cult in Culture
15:58 - Episode 34: Inflation and the Paradoxical Pay Raise
Visit busynessparadox.com to see this episode's transcript and webpage
Come visit us at busynessparadox.com to see episode transcripts, blog posts and other content while you’re there!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Frank Butler (00:08):
Breaking news Busybodies Marcelo
Car...Clar...Claire? Clark?
Paul Harvey (00:14):
I'm thinking Clar...Claure?
Frank Butler (00:17):
It doesn't matter
Paul Harvey (00:18):
It doesn't matter.
Frank Butler (00:20):
The dude's asking for a billion dollar bonus!
Actually 2 billion! And then itturned into a billion somewhere
in there, but either way, what?
Paul Harvey (00:29):
Shot down for a two, apparently, or at least $1
billion bonus. That's a roughday at the office.
Frank Butler (00:35):
I mean...
Paul Harvey (00:36):
We did that episode recently...we're about to do an
episode...we will soon releasean episode about asking for more
money. Imagine asking for thatmuch more money and getting shot
down.
Frank Butler (00:46):
I still can't digest the billion dollar or $2
billion ask. Now granted,there's a lot of information
that says that this guy kind ofhelped build out bail out
Softbank from a couple of badinvestments they made, including
we work and what was the otherone I know he had some
involvement with Sprint andgetting sprint sold off because
he was the CEO of Sprint for alittle bit before being brought
(01:08):
back in and being CEO of theSoftBank Group and then CEO of
SoftBank International. Now,here's the thing is that...I
study M&A a little bit. I'venever heard anybody getting paid
a billion dollars, because theircompany got acquired. And it's
not even his company, right?
It's like he was the CEO of acompany. Like that would be an
incredible buyout, right, somesort of golden parachute, to get
(01:31):
a billion dollars like unheardof, kind of golden parachute.
It's put it in perspective, Ithink the highest I ever heard
was Nardelli, when he got firedat Home Depot, and he got paid
$280 million, or something alongthose lines, that was like the
highest golden parachute. Itwould be different if it was his
company that he actually ownedthe company and founded it and
built it up, which he actuallydid do that at some point
(01:53):
because he sold his originalcompany to Softbank a few years
prior for like $1.6 billion.
So...what!?
Paul Harvey (02:02):
He's a guy who likes billion dollar deals,
Frank? Nothing wrong with that.
He's a mover and shaker.
Frank Butler (02:07):
Mover and shaker.
I mean, after your first billionright, you know, next billions
real easy.
Paul Harvey (02:13):
What have you done for me lately? Yeah. It does
kind of bring to mind aninteresting question regarding
compensation in general, andexecutive compensation, we often
think about it in terms of rawfigures via dollars, or Yen's,
or whatever currency we'reworking with. But if we think
about it, in terms of whatpercentage of the money that I
bring into a company, am I beingpaid? It sort of changes the
(02:37):
calculus a little bit. Now, itdoesn't work as a model for
compensation for most jobs, orat least for a lot of jobs,
because many jobs, you don'tproduce any profit, any revenue
whatsoever. In fact, you're acost center, you cost company
money, but you're still therefor obviously, for a reason. So
it wouldn't work that way. Butaccording to this one analysis
(02:57):
pushed out by the AssociatedPress. What he was asking for
assuming the $1 billion askwould have been 2.7% Was it of
soft banks? 2021. profit of $46billion. I think it's a lot of
money. It's not quite Applemoney, but it's it's a lot of
money. When you think of it thatway. We don't know how much
(03:21):
responsibility Anyone personcould possibly have for the
revenue that he's claimingresponsibility for, but 2.7% of
a company's overall profit. Thaton the surface sounds more
reasonable than a billiondollars. But even then, we this
analysis that we this breakingnews bulletin that we've just
(03:42):
seen, shows a comparison withother successful executives like
Tim Cook from Apple D. who justhad the most profitable quarter
in the history of anything.
Earning .07% was it? No, no...
.013%? Yeah. So
Frank Butler (04:03):
Here we go...
Paul Harvey (04:04):
Bonus money of .0013 of Apple's
profitability...I think.
Frank Butler (04:08):
Here's what they have here. "Last year, Apple's
board lavished CEO Tim Cook withroughly 95 million in bonuses."
And that's because the companyturned a profit of $94.7
billion. So he got point 1% ofearnings last year for his
bonus.
Paul Harvey (04:26):
That's almost conveniently almost exactly
double, I guess, SoftBanks 46billion there. So we do kind of
have a an interesting point ofcomparison. He was given 95
million said, which equatesroughly to that .0013% and this
guy over in Japan, he's notJapanese, but the company's in
(04:46):
Japan, asking for 2.7% Are youreally worth...what is that,
like 200 times what Tim Cook isworth?
Frank Butler (04:54):
You know, and it goes back to me that he didn't
found the company. It's notsomething he'd built up he
didn't do anything particularlyexcept getting packaged. For
example, with Sprint being soldto T Mobile, he just got the
company prepared to sell. I'venever heard of an executive
making a billion dollars forcoming in and turning a company
(05:15):
into something that can beprepared to be sold.
Paul Harvey (05:18):
Well you haven't heard of it because it hasn't
happened.
Frank Butler (05:19):
That's right The second element
is that they're also crediting
Paul Harvey (05:20):
Yet.
him with having turned theWeWork fiasco into something,
but when you look at it, theyactually had to what was it nine
$8.2 billion, they had a writeoff on that entire thing.
Softbank Vision Fund posts a$17.7 billion loss on WeWork and
(05:41):
Uber. I mean, granted, he didmanage to put WeWork into SPAC
and get it to go IPO that way,or basically get traded on the
market. But that's a big number.
So they might have had to writeoff $8.2 billion, or 17 point 7
billion. There's I'm seeing alot of different numbers of
write offs here. So is 8.9billion in 2019 17. Point 7
(06:02):
billion in 2020. Again, he mighthave come in and salvage
something from that, but abillion dollars.
Here's what Ithink. I think, on some level,
he kind of thought that he hadeither an implicit deal,
apparently there was somescribbled on a piece of paper
(06:22):
agreement between men MasayoshiSon, the CEO of SoftBank.
Masayoshi Son famously showeredWeWork with huge sums of money,
as those write offs Frank justmentioned would indicate. And I
think Marcelo here took what wasa gigantic loss and made it a
(06:47):
little bit less of a loss. Well,I shouldn't say a little bit,
much less of a loss than itwould have been otherwise. So I
kind of feel like maybe behindthe scenes, he said, "Dude, I
just helped you, like save someface here. Throw a billion my
way, call it even." I thinksomething like that might've
happened. And it wasn't intendedto become this big publicized,
you know, thing. I think it wassort of a backdoor deal, or at
(07:08):
least he thought it was abackdoor deal. And at least he
thought it was a deal. Neitherof those things, neither
backdoor nor a deal.
Frank Butler (07:17):
Yeah, I, I still can't fathom it. You know, they
they weren't example that onearticle uses that Elon Musk got
6.6 billion last year, two yearsago. And that's a hard
comparison to make because ElonMusk owns a significant chunk of
Tesla, for starters.
Paul Harvey (07:34):
I think they put that comparison in the article
strictly for search engineoptimization purposes.
Frank Butler (07:39):
It has to be, right?
Paul Harvey (07:40):
Let's name drop Elon Musk. I think that's it.
Frank Butler (07:43):
Yeah. I mean, it just it really does not make a
lot of sense. I mean, granted,I'm sure he's worth having $100
million $200 million bonus paidout over a couple of years,
maybe stock options, which iswhat a lot of people get
Paul Harvey (07:56):
See now, anchoring effect! Well...
One to two-hundred milliondollars now seems reasonable.
When you're comparing it to abillion.
Frank Butler (08:02):
No, but I mean, if you look at it, like like Tim
Cook got a $750 million stockoption back in 2011. That's not
vested or I thought it wasvested after 10 years, I, I
could be wrong.
Paul Harvey (08:14):
But that's a stock option, that's not cold hard
cash.
Frank Butler (08:16):
Right. It's not cash, right. That's a
difference. And I think that'swhat you're going with is that
the stock option is different.
It's now you have to take it inthe year to award it right. So
like, they had to pay a lot ofmoney on that tax, or like...
Paul Harvey (08:31):
How do you even price that? Like, 750 million in
at its current valuation or atits 2011 valuation?
Frank Butler (08:37):
I think it was at its 2011 is when he was taxed,
because he had to pay a big taxon that. But nonetheless, it's
like, that's, that was one ofthe biggest awards ever to a
non-owner type situation. Youknow, he's not, he's not found
founder, right. I mean, he ownedsome stock, but not like, you
know, sort of everybody right.
And I think that's one of thosethings to look at. Whereas, you
(08:59):
know, Elon Musk, while he didn'tfound Tesla, he did buy into him
relatively early and turn theminto who they are. It's a pretty
big deal, because when he tookover Tesla, they were using load
as bodies and putting batteriesin electric motors and and
turning those into it. And itwas kind of cool, but you know,
his niche he, and he had theidea of we need to really ramp
(09:20):
that up. But again, you look atthese folks like Jamie diamonds,
another example, Jamie diamond,he gets ridiculously high pay.
He's one of the highestcompensated CEOs out there.
Again, non founder, non owner,founder and CEO, he just got a
massive pay, but he's still lessthan he's actually less than Tim
Cook when you really compare itto the profits. Don't get me
(09:41):
wrong. I'm sure the guy deservesa good healthy bonus. But there
are times that you have to kindof pump the brakes a little bit.
And I think one of thesearticles touched into something
that was quite interesting,right? The idea that because
Softbank is a Japanese company,and tremendous payoff. So this
is what the article sayingtremendous past executives are
(10:03):
not looked kindly upon. Somaking these huge payments, that
also has implications, right?
You have to think of thecultural elements of this too.
If he were to pay out a hugenumber like that, how would the
stock market react in Japan? Howfor the Softbank stock? Or how
would the other executivesreact? How would how would the
(10:24):
country react? And what, whatwould the repercussions be for
that?
Paul Harvey (10:28):
And that's the biggest question I I keep coming
back to when it comes to thedebate about executive salaries
and bonuses is what's the point?
We're talking sums of money thatyou couldn't try to spend in
your entire lifetime? Why getyourself into such hot water
over? Over this? You don't needthe money? Can't use the money?
(10:49):
Wouldn't you rather have peoplelike like you and not have the
world see you as like a greedytroll like, well, he's
Frank Butler (10:56):
probably a grandiose narcissist or
something along those lines.
Yeah. But
Paul Harvey (11:00):
grandiose narcissist, want people to
respect them.
Frank Butler (11:03):
That's true. But they also want people to they
also want to be in the news,right? So there might be an
element of, he's getting a lotof attention,
Paul Harvey (11:08):
status and money or status. Like it's, you know, if
we can get him on the show.
Frank Butler (11:13):
And there we go. I keep thinking though. $2
billion, $1 billion. You'reright, it's you're never going
to spend that money in alifetime. And not only that,
he's also got a non compete,apparently, in his contract. So
he couldn't even like poachemployees or anything for a few
years. But the other element isthat they saw one of the
articles is that he's going toget a really healthy payout, by
(11:36):
leaving and in the magnitude ofa couple 100 million or
something like that. So it's notlike he's leaving poor.
Paul Harvey (11:45):
Now, I don't think he went in for and I don't think
he's leaving any worse off thanhe went in.
Frank Butler (11:50):
I think he's upset. Yeah, I think he's
significantly better off. Yeah,yeah. Here. Here's another
example. Right? So going back towe work, Adam Newman, who found
that company, they pushed himout because, you know, we work
with, I mean, that whole fiascowas just insane. There was a
whole quote unquote, well, theyquote unquote, a tech company or
like, you're, you're leasingoffice space, and temporary type
(12:12):
things. There's no tech there.
There's nothing that you canreally do in the way they were
doing it that was creating thattech company style valuations,
right? It just, it wasludicrous. And there's creepy
Paul Harvey (12:22):
as hell. Oh, anyone hasn't jumped down that rabbit
hole yet. I recommend it.
Frank Butler (12:26):
Well, you can also listen to our cults episode
where we kind of Yes, bring thatup. It's true. We did. We did so
But Adam Newman, they basicallypaid him $2 billion to get out.
However, Adam Newman actuallyowned the frickin company.
Paul Harvey (12:41):
Right. You know, then there's something
Frank Butler (12:45):
you got to compare apples apples, right? I don't
know. I it just boggles my minda little bit. The I mean, you
know, there's a way to do thisreasonably, if he feels like he,
he should have listened to ourepisode on how you should get a
pay raise. Right. And I don'tknow, the reason why we're doing
BREAKING NEWS on this is thatthis is truly one of those
moments of this is next level,this is something that yeah, you
(13:08):
kind of get the chaos with ElonMusk getting a $6.6 billion
payout. Or, you know, LarryEllison, at some point was
getting paid out ridiculousmoney, or Steve Jobs was
getting, you know, big moneywhen Disney bought Pixar. And
that made him the largestindividual shareholder in, in
Disney and it was what $7billion, or something like that?
I don't, I don't remember thenumber. But, you know, again,
(13:31):
it's because the guys actuallyowned and made these things and
turned them into what they are,and then got their fruits of
their labors from that. I don'tthink I've ever heard of an
executive being paid that kindof money that they didn't have
significant ownership stake orfound the company at any point.
I mean, this these numbers arejust, I mean, Tim Cook got $750
(13:52):
million in options, but that wasrolled out over a longevity
bonus. It's like you have tostay here and you have to
because it's an option. He has astrike price he has to hit it
has to hit a certain valuation,which I would say given that
when he received I don't knowwhat the apple valuation was in
2011.
Paul Harvey (14:09):
It'll hit the strike price [laughs]. He's well
into the money at this point.
Frank Butler (14:12):
Yeah, I was gonna say because what was their
valuation? Okay, so their marketcap in 2011 Hit 337 billion. So
about 10 times today, right?
They've almost hit 3 trillion orthey take three Charlie did
briefly, huh? Okay. 750 millionwhen you create $202.7 trillion
evaluation? That's a drop in thebucket.
Paul Harvey (14:39):
Not even a rounding error.
Frank Butler (14:40):
I, I can't...I just, I can't
Paul Harvey (14:43):
I can't either. In fact, I'm going to take this
opportunity to announce mydeparture from the Busyness
Paradox. Frank and I have agreedto a $700 million buyout. See
you guys later.
Frank Butler (14:53):
Wohoo! I'm retiring. Take care everybody.
Paul Harvey (14:55):
No, you're buying me out.
Frank Butler (14:56):
Oh, dang, I don't, uh...I'll have to pay you out
over 700 million years.
Paul Harvey (15:03):
70 lifetimes [laughter]
Frank Butler (15:04):
A dollar a year.
Oh goodness.
Paul Harvey (15:15):
Good day, folks.
Frank Butler (15:16):
Take care.
Paul Harvey (15:18):
The Busyness Paradox is distributed by Paul
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(15:40):
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(16:03):
podcasts.
Breaking news Busybodies Marcelo
Car...Clar...Claire? Clark?
Paul Harvey (00:14):
I'm thinking Clar...Claure?
Frank Butler (00:17):
It doesn't matter
Paul Harvey (00:18):
It doesn't matter.
Frank Butler (00:20):
The dude's asking for a billion dollar bonus!
Actually 2 billion! And then itturned into a billion somewhere
in there, but either way, what?
Paul Harvey (00:29):
Shot down for a two, apparently, or at least $1
billion bonus. That's a roughday at the office.
Frank Butler (00:35):
I mean...
Paul Harvey (00:36):
We did that episode recently...we're about to do an
episode...we will soon releasean episode about asking for more
money. Imagine asking for thatmuch more money and getting shot
down.
Frank Butler (00:46):
I still can't digest the billion dollar or $2
billion ask. Now granted,there's a lot of information
that says that this guy kind ofhelped build out bail out
Softbank from a couple of badinvestments they made, including
we work and what was the otherone I know he had some
involvement with Sprint andgetting sprint sold off because
he was the CEO of Sprint for alittle bit before being brought
(01:08):
back in and being CEO of theSoftBank Group and then CEO of
SoftBank International. Now,here's the thing is that...I
study M&A a little bit. I'venever heard anybody getting paid
a billion dollars, because theircompany got acquired. And it's
not even his company, right?
It's like he was the CEO of acompany. Like that would be an
incredible buyout, right, somesort of golden parachute, to get
(01:31):
a billion dollars like unheardof, kind of golden parachute.
It's put it in perspective, Ithink the highest I ever heard
was Nardelli, when he got firedat Home Depot, and he got paid
$280 million, or something alongthose lines, that was like the
highest golden parachute. Itwould be different if it was his
company that he actually ownedthe company and founded it and
built it up, which he actuallydid do that at some point
(01:53):
because he sold his originalcompany to Softbank a few years
prior for like $1.6 billion.
So...what!?
Paul Harvey (02:02):
He's a guy who likes billion dollar deals,
Frank? Nothing wrong with that.
He's a mover and shaker.
Frank Butler (02:07):
Mover and shaker.
I mean, after your first billionright, you know, next billions
real easy.
Paul Harvey (02:13):
What have you done for me lately? Yeah. It does
kind of bring to mind aninteresting question regarding
compensation in general, andexecutive compensation, we often
think about it in terms of rawfigures via dollars, or Yen's,
or whatever currency we'reworking with. But if we think
about it, in terms of whatpercentage of the money that I
bring into a company, am I beingpaid? It sort of changes the
(02:37):
calculus a little bit. Now, itdoesn't work as a model for
compensation for most jobs, orat least for a lot of jobs,
because many jobs, you don'tproduce any profit, any revenue
whatsoever. In fact, you're acost center, you cost company
money, but you're still therefor obviously, for a reason. So
it wouldn't work that way. Butaccording to this one analysis
(02:57):
pushed out by the AssociatedPress. What he was asking for
assuming the $1 billion askwould have been 2.7% Was it of
soft banks? 2021. profit of $46billion. I think it's a lot of
money. It's not quite Applemoney, but it's it's a lot of
money. When you think of it thatway. We don't know how much
(03:21):
responsibility Anyone personcould possibly have for the
revenue that he's claimingresponsibility for, but 2.7% of
a company's overall profit. Thaton the surface sounds more
reasonable than a billiondollars. But even then, we this
analysis that we this breakingnews bulletin that we've just
(03:42):
seen, shows a comparison withother successful executives like
Tim Cook from Apple D. who justhad the most profitable quarter
in the history of anything.
Earning .07% was it? No, no...
.013%? Yeah. So
Frank Butler (04:03):
Here we go...
Paul Harvey (04:04):
Bonus money of .0013 of Apple's
profitability...I think.
Frank Butler (04:08):
Here's what they have here. "Last year, Apple's
board lavished CEO Tim Cook withroughly 95 million in bonuses."
And that's because the companyturned a profit of $94.7
billion. So he got point 1% ofearnings last year for his
bonus.
Paul Harvey (04:26):
That's almost conveniently almost exactly
double, I guess, SoftBanks 46billion there. So we do kind of
have a an interesting point ofcomparison. He was given 95
million said, which equatesroughly to that .0013% and this
guy over in Japan, he's notJapanese, but the company's in
(04:46):
Japan, asking for 2.7% Are youreally worth...what is that,
like 200 times what Tim Cook isworth?
Frank Butler (04:54):
You know, and it goes back to me that he didn't
found the company. It's notsomething he'd built up he
didn't do anything particularlyexcept getting packaged. For
example, with Sprint being soldto T Mobile, he just got the
company prepared to sell. I'venever heard of an executive
making a billion dollars forcoming in and turning a company
(05:15):
into something that can beprepared to be sold.
Paul Harvey (05:18):
Well you haven't heard of it because it hasn't
happened.
Frank Butler (05:19):
That's right The second element
is that they're also crediting
Paul Harvey (05:20):
Yet.
him with having turned theWeWork fiasco into something,
but when you look at it, theyactually had to what was it nine
$8.2 billion, they had a writeoff on that entire thing.
Softbank Vision Fund posts a$17.7 billion loss on WeWork and
(05:41):
Uber. I mean, granted, he didmanage to put WeWork into SPAC
and get it to go IPO that way,or basically get traded on the
market. But that's a big number.
So they might have had to writeoff $8.2 billion, or 17 point 7
billion. There's I'm seeing alot of different numbers of
write offs here. So is 8.9billion in 2019 17. Point 7
(06:02):
billion in 2020. Again, he mighthave come in and salvage
something from that, but abillion dollars.
Here's what Ithink. I think, on some level,
he kind of thought that he hadeither an implicit deal,
apparently there was somescribbled on a piece of paper
(06:22):
agreement between men MasayoshiSon, the CEO of SoftBank.
Masayoshi Son famously showeredWeWork with huge sums of money,
as those write offs Frank justmentioned would indicate. And I
think Marcelo here took what wasa gigantic loss and made it a
(06:47):
little bit less of a loss. Well,I shouldn't say a little bit,
much less of a loss than itwould have been otherwise. So I
kind of feel like maybe behindthe scenes, he said, "Dude, I
just helped you, like save someface here. Throw a billion my
way, call it even." I thinksomething like that might've
happened. And it wasn't intendedto become this big publicized,
you know, thing. I think it wassort of a backdoor deal, or at
(07:08):
least he thought it was abackdoor deal. And at least he
thought it was a deal. Neitherof those things, neither
backdoor nor a deal.
Frank Butler (07:17):
Yeah, I, I still can't fathom it. You know, they
they weren't example that onearticle uses that Elon Musk got
6.6 billion last year, two yearsago. And that's a hard
comparison to make because ElonMusk owns a significant chunk of
Tesla, for starters.
Paul Harvey (07:34):
I think they put that comparison in the article
strictly for search engineoptimization purposes.
Frank Butler (07:39):
It has to be, right?
Paul Harvey (07:40):
Let's name drop Elon Musk. I think that's it.
Frank Butler (07:43):
Yeah. I mean, it just it really does not make a
lot of sense. I mean, granted,I'm sure he's worth having $100
million $200 million bonus paidout over a couple of years,
maybe stock options, which iswhat a lot of people get
Paul Harvey (07:56):
See now, anchoring effect! Well...
One to two-hundred milliondollars now seems reasonable.
When you're comparing it to abillion.
Frank Butler (08:02):
No, but I mean, if you look at it, like like Tim
Cook got a $750 million stockoption back in 2011. That's not
vested or I thought it wasvested after 10 years, I, I
could be wrong.
Paul Harvey (08:14):
But that's a stock option, that's not cold hard
cash.
Frank Butler (08:16):
Right. It's not cash, right. That's a
difference. And I think that'swhat you're going with is that
the stock option is different.
It's now you have to take it inthe year to award it right. So
like, they had to pay a lot ofmoney on that tax, or like...
Paul Harvey (08:31):
How do you even price that? Like, 750 million in
at its current valuation or atits 2011 valuation?
Frank Butler (08:37):
I think it was at its 2011 is when he was taxed,
because he had to pay a big taxon that. But nonetheless, it's
like, that's, that was one ofthe biggest awards ever to a
non-owner type situation. Youknow, he's not, he's not found
founder, right. I mean, he ownedsome stock, but not like, you
know, sort of everybody right.
And I think that's one of thosethings to look at. Whereas, you
(08:59):
know, Elon Musk, while he didn'tfound Tesla, he did buy into him
relatively early and turn theminto who they are. It's a pretty
big deal, because when he tookover Tesla, they were using load
as bodies and putting batteriesin electric motors and and
turning those into it. And itwas kind of cool, but you know,
his niche he, and he had theidea of we need to really ramp
(09:20):
that up. But again, you look atthese folks like Jamie diamonds,
another example, Jamie diamond,he gets ridiculously high pay.
He's one of the highestcompensated CEOs out there.
Again, non founder, non owner,founder and CEO, he just got a
massive pay, but he's still lessthan he's actually less than Tim
Cook when you really compare itto the profits. Don't get me
(09:41):
wrong. I'm sure the guy deservesa good healthy bonus. But there
are times that you have to kindof pump the brakes a little bit.
And I think one of thesearticles touched into something
that was quite interesting,right? The idea that because
Softbank is a Japanese company,and tremendous payoff. So this
is what the article sayingtremendous past executives are
(10:03):
not looked kindly upon. Somaking these huge payments, that
also has implications, right?
You have to think of thecultural elements of this too.
If he were to pay out a hugenumber like that, how would the
stock market react in Japan? Howfor the Softbank stock? Or how
would the other executivesreact? How would how would the
(10:24):
country react? And what, whatwould the repercussions be for
that?
Paul Harvey (10:28):
And that's the biggest question I I keep coming
back to when it comes to thedebate about executive salaries
and bonuses is what's the point?
We're talking sums of money thatyou couldn't try to spend in
your entire lifetime? Why getyourself into such hot water
over? Over this? You don't needthe money? Can't use the money?
(10:49):
Wouldn't you rather have peoplelike like you and not have the
world see you as like a greedytroll like, well, he's
Frank Butler (10:56):
probably a grandiose narcissist or
something along those lines.
Yeah. But
Paul Harvey (11:00):
grandiose narcissist, want people to
respect them.
Frank Butler (11:03):
That's true. But they also want people to they
also want to be in the news,right? So there might be an
element of, he's getting a lotof attention,
Paul Harvey (11:08):
status and money or status. Like it's, you know, if
we can get him on the show.
Frank Butler (11:13):
And there we go. I keep thinking though. $2
billion, $1 billion. You'reright, it's you're never going
to spend that money in alifetime. And not only that,
he's also got a non compete,apparently, in his contract. So
he couldn't even like poachemployees or anything for a few
years. But the other element isthat they saw one of the
articles is that he's going toget a really healthy payout, by
(11:36):
leaving and in the magnitude ofa couple 100 million or
something like that. So it's notlike he's leaving poor.
Paul Harvey (11:45):
Now, I don't think he went in for and I don't think
he's leaving any worse off thanhe went in.
Frank Butler (11:50):
I think he's upset. Yeah, I think he's
significantly better off. Yeah,yeah. Here. Here's another
example. Right? So going back towe work, Adam Newman, who found
that company, they pushed himout because, you know, we work
with, I mean, that whole fiascowas just insane. There was a
whole quote unquote, well, theyquote unquote, a tech company or
like, you're, you're leasingoffice space, and temporary type
(12:12):
things. There's no tech there.
There's nothing that you canreally do in the way they were
doing it that was creating thattech company style valuations,
right? It just, it wasludicrous. And there's creepy
Paul Harvey (12:22):
as hell. Oh, anyone hasn't jumped down that rabbit
hole yet. I recommend it.
Frank Butler (12:26):
Well, you can also listen to our cults episode
where we kind of Yes, bring thatup. It's true. We did. We did so
But Adam Newman, they basicallypaid him $2 billion to get out.
However, Adam Newman actuallyowned the frickin company.
Paul Harvey (12:41):
Right. You know, then there's something
Frank Butler (12:45):
you got to compare apples apples, right? I don't
know. I it just boggles my minda little bit. The I mean, you
know, there's a way to do thisreasonably, if he feels like he,
he should have listened to ourepisode on how you should get a
pay raise. Right. And I don'tknow, the reason why we're doing
BREAKING NEWS on this is thatthis is truly one of those
moments of this is next level,this is something that yeah, you
(13:08):
kind of get the chaos with ElonMusk getting a $6.6 billion
payout. Or, you know, LarryEllison, at some point was
getting paid out ridiculousmoney, or Steve Jobs was
getting, you know, big moneywhen Disney bought Pixar. And
that made him the largestindividual shareholder in, in
Disney and it was what $7billion, or something like that?
I don't, I don't remember thenumber. But, you know, again,
(13:31):
it's because the guys actuallyowned and made these things and
turned them into what they are,and then got their fruits of
their labors from that. I don'tthink I've ever heard of an
executive being paid that kindof money that they didn't have
significant ownership stake orfound the company at any point.
I mean, this these numbers arejust, I mean, Tim Cook got $750
(13:52):
million in options, but that wasrolled out over a longevity
bonus. It's like you have tostay here and you have to
because it's an option. He has astrike price he has to hit it
has to hit a certain valuation,which I would say given that
when he received I don't knowwhat the apple valuation was in
2011.
Paul Harvey (14:09):
It'll hit the strike price [laughs]. He's well
into the money at this point.
Frank Butler (14:12):
Yeah, I was gonna say because what was their
valuation? Okay, so their marketcap in 2011 Hit 337 billion. So
about 10 times today, right?
They've almost hit 3 trillion orthey take three Charlie did
briefly, huh? Okay. 750 millionwhen you create $202.7 trillion
evaluation? That's a drop in thebucket.
Paul Harvey (14:39):
Not even a rounding error.
Frank Butler (14:40):
I, I can't...I just, I can't
Paul Harvey (14:43):
I can't either. In fact, I'm going to take this
opportunity to announce mydeparture from the Busyness
Paradox. Frank and I have agreedto a $700 million buyout. See
you guys later.
Frank Butler (14:53):
Wohoo! I'm retiring. Take care everybody.
Paul Harvey (14:55):
No, you're buying me out.
Frank Butler (14:56):
Oh, dang, I don't, uh...I'll have to pay you out
over 700 million years.
Paul Harvey (15:03):
70 lifetimes [laughter]
Frank Butler (15:04):
A dollar a year.
Oh goodness.
Paul Harvey (15:15):
Good day, folks.
Frank Butler (15:16):
Take care.
Paul Harvey (15:18):
The Busyness Paradox is distributed by Paul
Harvey and Frank Butler. Ourtheme music is adapted from
"It's Business Time" by JemaineClements and Bret McKenzie. Our
production manager is JustinWuntaek. We hope you've enjoyed
this episode, and we'd love tohear from you. Please send any
questions, comments or ideas forfuture episode topics to
(15:40):
input@busynessparadox.com, orfind us on Twitter. Also, be
sure to visit our website,busynessparadox.com, to read our
blog posts and for links to thearticles and other resources
mentioned in today's show.
Finally, please take a moment torate and follow or subscribe to
our show on Apple podcasts,Spotify, iHeartRadio, Google
Podcasts or...I don't know,wherever the heck you get your
(16:03):
podcasts.
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