In a press release, Opendoor said it was “going into founder mode” with Nejatian’s appointment and in luring Rabois and Wu back with seats on the board and new financing.
“Literally there was only one choice for the job: Kaz,” said Rabois in a statement. “I am thrilled that he will be serving as CEO of Opendoor.”
Nejatian, who previously cofounded a payment tech company called Kash, will also get two performance-based awards. The first award of 40.9 million shares is basically designed around ensuring that shareholder value isn’t eroded, said Farient Advisors vice president Eric Hoffmann. The shares vest in installments over five years with a stock price gate of $6.24, which means the stock has to maintain an average closing price of $6.24 or higher over a 60-day period for vesting to take place. Opendoor’s stock surged more than 78% on Thursday following Nejatian’s appointment to $10.49, but in June, the stock hovered around 56 cents a share.
The second performance award is designed like a moonshot with seven stock price hurdles ranging from $9 to $33. The tranches only vest when the stock hits price milestones of $9, $13, $17, $21, $25, and $33.
If Nejatian can hit all those price targets, he’ll be rewarded with compensation valued at $2.78 billion—and he’ll own 11.6% of the company, double the stake Wu held when Opendoor went public through a SPAC in 2020, Hoffmann told Fortune.
“What I find interesting is that they clearly believe that this guy, who was the COO at Shopify, is going to make or break this company,” said Hoffmann. “They are willing to make a very large bet and put a lot of power and money into his pocket to get him on board and motivated to grow and drive the company forward.”
Nejatian, conversely, will have a base salary of $1 and no bonus.
“It’s a privilege to become Opendoor’s leader,” said Nejatian. “Few life events are as important as buying or selling a home. With AI, we have the tools to make that experience radically simpler, faster, and more certain. That’s the future we’re building.”
