John Riccitiello, CEO of Unity, the company whose 3D game engine had recently seen backlash from developers over proposed fee structures, will retire as CEO, president, and board chairman at the company, according to a press release issued late on a Monday afternoon, one many observe as a holiday.
Drops a nuke on their stock
“Well, guess my work is done. I’ll take my $400 million golden parachute and just step over the pieces of my broken company as I shuffle out to my car. Peace, bro.”
Someone find out if he or his family sold stock before the drop.
I’ve heard he sold some stock but it was like a recurring sell-this-much-every-this-often type of thing so it wasn’t out of the ordinary is what I heard.
Yeah… Except I heard he started this process to sell off most of his stock several months ago. His actions look a lot like “we’re going to risk everything and either increase profits or kill the company, either way we get a huge payout”
That’s odd. I heard he specifically shorted on Unity before he announced it and that’s some sleazy shit.
That would be a dumb move on his part. Stock manipulation that blatant would have the SEC chewing on his entrails in a matter of minutes.
The most likely scenario is that he was paid at least partially in company stock. This is fairly common for the C-level, because it allows them to loosely tie their income to the company’s stock price. When the company does well, the C-level makes more money.
So he likely had an automated recurring sale set up, to sell off part of what he was being paid. So if he’s paid 25 stocks per pay period, maybe he sells off 15 automatically and keeps 10. This allows him to remain more liquid (or diversify his investment portfolio by reinvesting that money into other companies’ stock,) so he isn’t keeping all of his eggs in one basket. It’s the smart thing to do, but can also be bad PR if the stock for your company tanks right after your automated sale goes through.
At most, he could’ve timed the announcement to happen right after his stock sale. So he can automatically sell when the price is still good, then watch it tank immediately after the sale. That’s not stock market manipulation per the current rules, (because he didn’t actually change how much he was selling, or change when the sale would happen) but it’s still scummy.
I’m not sure if it’s an accident, but the value of $400m is exactly how much private equity firm Silver Lake invested in them in 2017. They were backed by a lot of private equity and VC money before they had an IPO.
Unity IPO’d 3 years ago in Sept 2020 at $52 per share, they’re now at $30/share, and have been under $50/share since May of 2022. The chairman of the board, Roelof Frederik Botha, is a partner at Sequoia Capital.
This is a business run by VC / PE people, that’s doing shitty in the market, and was doing badly before this whole license fee event. It’s not going to come to its senses and start behaving well just because the scapegoat CEO is gone. They need to juice their revenue streams to make investors happy, because it’s worth significantly less than it was at the IPO.
I just hope nobody is saying “Yay, now that the evil CEO is gone, Unity will be good again.” Anybody thinking that is just setting themselves up for whatever the company does next to juice their failing stock price.
Is that… the guy from EA?
This explains lot!
Too late, I wouldn’t trust Unity from this point on. Spend tons of time and effort only to have it all yanked away. Screw that!
We’ll see what happens with Dyson Sphere Program. They’re too far into development to switch engines, and are still in early access with a technically “complete” game already.
Tell me again why these hacks get paid so much for “taking risks” when they never end up being fired? I have not seen a single CEO officially fired from a company for driving it into the ground. They always “choose” to retire after fucking up the entire thing and collect a fat paycheck for doing so.
when they never end up being fired
When you’re a career professional, this is what being fired looks like.
“Choosing to retire” is face-saving language for “is being asked to step down,” which is sort of like the police asking you to turn yourself in. You can choose not to, but you’re still getting arrested either way
yes and that’s bullshit. They run a company into the ground, risking and often costing the livelyhoods of hundreds or thousands of employees and then take a fat bonus because, as you said, they were not fired, they were forced to resign. Sitting comfortably in their golden parachute they then glide over to the next opportunity to ruin people’s lives and days.
Also since you did not get that I was hinting at exactly what you wrote by using “choose” instead of choose and you seemingly not being the first person to stumble over that I have to work on my sarcasm skills.
They’d get paid severance if they were fired - it’s likely them “retiring” saves the company money overall.
I do agree that CEO compensation is insane, due to perverse incentives, but this seems like harm reduction on the part of the board
I do apologize for missing your sarcasm as well.
get paid severance if they were fired - it’s likely them “retiring” saves the company money overall.
Typically that is true but at this level executives have contracts with non-compete clauses and as part of that even voluntary departures usually come with a severence, since they aren’t allowed to work in the industry for 6-12 months after leaving (unless they negotiate something as part of their departure). It’s very likely he got a generous payout.
It’s seen as a necessity for protecting intellectual property and company knowledge that the leaders take with them when they leave. It’s why so many execs start their own businesses after leaving big companies but don’t officially open shop for a while.
It really doesn’t matter if they step down or are fired. The words are meaningless. They will still get hired to run another company.
It’s advantageous to have someone quit from a severance/unemployment stance.
It’s also why if you feel like you’re about to get fired without cause and don’t already have a job lined up you should absolutely wait for them to fire you so you can collect unemployment.
Once you slightly climb the career ladder, vocabulary turns into marketing bs. Suddenly you most not say “problem” anymore. They’re “opportunities” or “challenges”. So at that level you don’t get “fired” because that would sound bad for the next company you’re going with. You’re looking for new challenges elsewhere. Leaving behind a dumpster fire like in this very case.
I mean with a company that big, they can just google you to see what you messed up
Yep they get all the praise when things go good. But shit happens and it’s lnever their fault.
You don’t get fired when you’re at the management level, you “resign”.
You only get to become CEO when you have friends in high places. Why would anyone risk the backlash for hurting you when silently letting you go with a golden handshake doesn’t cost their own money or at least a neglegible part of it.
I know but to the common pleb it’s still always sold as “well they get this much money because they’re on the hook if the company goes down” which, as shown time and time again, is just not how these parasites operate. No they operate exactly as you describe it moving from one opportunity to suck money out of the lower classes to another.
Pisses me off that CEOs never get fired for their bullshit and get to “retire” or “resign” like they didn’t just make the most boneheaded decision that severely hurt the company.
There really needs to be some organizational structure where the CEOs have the power to make the decisions they make, but the employees have the power to punish and fire them when they do shit like this. No golden parachutes for them!
You’re saying the workers should own the means of production. Sounds fair to me.
Pisses me off that CEOs never get fired for their bullshit and get to “retire” or “resign” like they didn’t just make the most boneheaded decision that severely hurt the company.
They’re rich people and it’s not considered acceptable to hold rich people accountable in even the most trivial way.
The Rich only suffer under the boots of the evolved form ultra rich
The only way this can be done in a capitalist way, is by distributing exactly one company share for every employee that’s not tradeable at all, flattening the hierarchy completely, and making every decision in a direct democratic way.
That’s not just CEOs. All employees after a certain point up the ladder have to “put in their resignation” if they are to be fired. It’s a convention that saves face for both parties.
CEOs are beholden to the shareholders, not the employees
In a co-operative the shareholders are employees and associated members, and they elect the board.
https://en.wikipedia.org/wiki/Consumers'_co-operative
Not that Unity is a co-operative, but there is another way.
Yes, I understand that’s the current structure. I’m saying there needs to be a new structure where CEOs can’t make greedy decisions with impunity. Clearly the idea that the board is supposed to prevent that doesn’t work because this story is all too common.
This is actually wrong. There’s a near 100% chance that the decision was made by the board, and also the decision to remove the CEO. So we’re talking about the fall guy, but being an insider, the fall guy will get a tidy sum for the dive
Then the CEO can be recycled to some other project, and a new CEO instated at Unity, so they can pivot or double down with no moral dilemma. In reality, the board was there all along and it’s all a big PR game
Ackshually!
Urrespective of all the other BS, why was the CEO also president of the board?
The role of the board is to supervise the executives.
That’s not exactly an uncommon structure. In case you’re just realizing this now: rich people are a bunch of corrupt fuckers.
“We investigated ourselves and found we did nothing wrong.” is a common sentence in America.
Who wouldn’t want to supervise themselves?
Damn this CEO is so good, maybe he should get a raise
I see you’re CEO material, interested in running Unity?
Well how else could he supervise himself?
Wow he only had to tank the company before his 50m worth of EA ownership became a problem…
Why do we call it “retiring” when we all know he’ll be CEO of some other company in 2 months?
I can’t imagine who would hire him. He fucked Unity badly.
Just a reminder that Unity hired him after EA.
inb4 he gets a job at fucking blackstone inc or something lmao
Yeah, after burning down something popular, he get off without any repercussions (aside maybe a big bag of cash) and is likely to go find the next successful thing to burn it down, to get another big bag of cash.
Can we purge these people out once they failed everywhere?
He didn’t fail. He did what the board asked of him which proved to be more unpopular than they all had expected. So they gave him an obscenely generous severance package and sent him on his merry way.
He’s been rewarded and they’re just trying to position it so it looks like the company leadership gives a shit and won’t try the exact same thing at a later date.
death to Unity long live Godot
Are we all just Waiting for Godot?
Out with the old guy and in with the new guy. No change to the incentive structure. I wonder if things will turn out differently this time?
I hope Unity users will get to continue to use the tool they have spent so many hours learning. I also think the industry should try to make things more CEO proof.
The problem is making it more shareholder proof. Enshittification comes from the line go up mandate. Unity is but a single example.
Enshittification might be my new favorite word
This is so true. Shareholders couldn’t care less if he was popular with customers. All they care about is whether he can do anything to boost profits. In their world, even the situation with Unity can be spun as “innovative” (in the sense that it introduced another revenue stream for the company) and that even if this initial implementation is scrapped, it can be learned from and improved on for future ones.
I also hope that they continue to be able to use that tool, but at this point, it’s clear to me that it would be wise to start learning new tools. For me, it’s not just that the company has made a mistake, but that the mistake was a repeat of a mistake they made back in 2019, which indicates that they may well do it again.
Former EA CEO will be replaced in interim by James Whitehurst from IBM/Red Hat.
Is that better or worse?
I swear they treat CEO’s who tank companies like they do priests who molest kids and just send them to another place whenever they get caught.
That’s corporatism in a wider sense. Existed since times immemorial. It’s a systemic problem, that is, defined by architecture.
Corporatism like this is fairly new. Creating bullshit positions for your followers is an old tradition among kings and other rulers, but putting people from one leadership position where they fucked up into the next is only here since the capitalist class established itself after the industrial revolution.
Actually the former included the latter. So no.
The legal fiction known as incorporation or corporate personhood did not exist until the 1400s, and for the first couple of hundred years was used only for churches to acquire assets and land.
I think what you’re thinking of might be conglomeration, where one company buys every business in its supply and distribution chains. Such as when the Tonight Show and The Late Show are owned by the same people that make nuclear reactors.
That’s not what I’m talking about, I meant, say, helping those similar to you with the implicit idea that they’d help you too, and that being a common rule in a certain subset of the society, thus working.
Can’t remember now why I chose that word, “corporatism”. (Not important for the subject, but Knights Templar or any trading family or clan that would exist before 1400s can still be called corporations, same for religious sects.)
Presumably with a generous severance package and pension.
Yeah, yeah, I assume he got like 4727928 bazillion golden parachute or some bullshit
