It’s been a rocky 14 months since Snap Inc. went public, and the Venice-based app-maker’s disappointing 2018 first quarter earnings coincided with a change to its C-suite.
The company announced in a Securities and Exchange Commission filing May 7 that Chief Financial Officer Drew Vollero was stepping down effective May 15.
No reason was given for Vollero’s departure.
“He has done an amazing job as Snap’s first CFO, building a strong team and helping to guide us through our transition to becoming a public company,” Snap Chief Executive Evan Spiegel said in the SEC filing. “The discipline that he has brought to our business will serve us well into the future. We wish Drew continued success and all the best.”
Tim Stone will take over for Vollero, arriving from Amazon.com Inc. where he was the vice president of finance. He’s set to receive $20 million in stock options with the right to purchase an additional 500,000 shares. Vollero will stay on as a “non-employee advisor” until Aug. 15, according to the Securities and Exchange Commission filing.
The word on the CFO switch preceded the latest swoon in the social media company’s shares, which sunk below $11 for the first time in mid-May. Shares are now less than half of their value on the day Snap went public last year.
Shares have been dipping since the company’s May 1 earnings report, which showed Snap’s revenue at $230.6 million for the quarter, with a loss of $385 million. The chief disappointment for investors seemed to be a miss on expectations for new users of the app, which added four million during the quarter, well short of Wall Street expectations.
Analysts suggest a lot of the decline is due to Snapchat’s January redesign, which hasn’t exactly caught on. A research poll from YouGov BrandIndex shows 18-to-34-year-olds approval of the app sunk by 73 percent since the new interface rolled out.
Amazon Rings In
Both Ring Inc. and Amazon.com Inc. have been quiet since the web retail giant acquired the home security company for $1 billion.
The silence ended earlier this month when ring announced a move from Santa Monica to Hawthorne, which is known for being an aerospace hub but has recently begun attracting startups and tech companies.
Mucker Capital partner William Hsu said moves like this are similar to Silicon Valley companies relocating to San Jose.
“Moving is inevitable,” Hsu said. “Real estate is too scare and expensive in a lot of the start up hubs.”
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