Snowflake CEO Steps Down From Post Richer Than Tim Cook or Satya Nadella
(Bloomberg) -- Frank Slootman, who just stepped down as Snowflake Inc. chief executive officer, isn’t a name that springs to mind as one of the tech industry’s most prominent CEOs. But Slootman has parlayed his time atop three companies into a net worth higher than tech leaders like Apple Inc.’s Tim Cook or Microsoft Corp.’s Satya Nadella.
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As Slootman leaves his CEO post at the software company, he has a fortune of about $3.7 billion, according to the Bloomberg Billionaires Index. That tops Cook, who is worth about $2 billion, and Nadella, who was not yet a billionaire as of July 2023.
It’s rare for a non-founder in the tech industry to amass that level of wealth — Slootman did it by leading Snowflake and ServiceNow Inc. through initial public offerings and was head of data-storage firm Data Domain when it was taken over by EMC Corp. in 2009.
Along the way, he developed a cult-like reputation in the software industry for being a tough leader with a to-the-point communication style. CEOs need to be “insanely confrontational,” he said in an episode of the No Priors podcast in 2023.
“Frank understands how hard it is to build companies and he’s done it repeatedly,” said David McJannet, CEO of HashiCorp Inc., another software infrastructure company, in a September interview. “People like that are relatively unflinching in their views and they are right a lot of times, so people tend to want to follow them.”
The news he was leaving the CEO role alongside an underwhelming sales outlook caused Snowflake stock to plummet 18% Thursday, marking its worst day ever. That drop alone dented Slootman’s net worth by about $500 million. The company declined to comment on his net worth.
“It is no doubt concerning to see Mr. Slootman, who has a strong track record and is well regarded by investors, step down after five years in the role,” wrote Brad Zelnick, an analyst at Deutsche Bank AG, in a note Thursday.
Another analyst, Bernstein’s Mark Moerdler, wrote that he wondered if the sudden change was due to recent disappointments in the company’s revenue growth. Slootman said in an interview with Barron’s that the idea his departure was related to a poorly received growth guidance was an “absurd notion.”
Over the last four years, Slootman has sold shares at an average weighted price of about $268 — well above the drop to $188 Thursday. He first joined Snowflake in 2019, and led the company through what was the largest software IPO ever the following year. At one point his stock awards were worth $108 million per month.
His statements have elicited controversy. In 2021, Slootman was criticized for saying that diversity goals were secondary to merit in hiring, though he later apologized, saying he didn’t intend to imply that diversity and merit were mutually exclusive. He has donated to Republican and Libertarian politicians, including in Montana, where he spends much of his time and Snowflake relocated its executive office to in 2021.
Slootman’s replacement, Sridhar Ramaswamy, a former executive at Alphabet Inc.’s Google, is seen as a technical leader. Ramaswamy will be awarded about $100 million in stock awards over the next five years in addition to a $750,000 annual salary, according to a filing Wednesday. He’ll also get an annual incentive bonus targeted at 100% of his salary.
Other non-founders who became billionaires through leading tech companies include Steve Ballmer, one of Microsoft’s first salespeople who went on to become CEO, and is now the sixth-richest person on the Bloomberg Billionaires Index. Palo Alto Networks Inc. CEO Nikesh Arora recently became a billionaire as the company’s share price has surged.
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