As Facebook IPO Looms, Netflix’s Reed Hastings Sits Pretty

1 Feb, 2012 By: Erik Gruenwedel

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While 2011 might have been a year to forget for Netflix co-founder Reed Hastings, the CEO appears to be sitting on a veritable goldmine as a member of Facebook’s board. The social media behemoth Feb. 1 filed papers for an initial public offering (IPO) that is expected to be the largest in history at around $5 billion.

Hastings was appointed to the Facebook board last June by founder, chairman and CEO Mark Zuckerberg. Hastings was appointed due to his expertise in technology, according to the filing. Hastings also sits on Microsoft’s board.

Hastings holds 20,000 shares of “restricted stock units” (RSUs), which allow him to receive cash or stock value of Class B common stock shares upon satisfying a vesting period, according to the filing. Hastings’ vesting condition (which could be a period of time or based on job performance) is not expected to occur before March 31.

Hastings earned more than $610,000 in total compensation from Facebook in 2011, which included $16,667 in board fees and $593,400 in stock-based compensation.

Hastings, together with 11 other senior executives (including Zuckerberg) and board members, collectively hold more than 42 million shares of Facebook Class A common stock and more than 1.3 billion shares of Class B common stock.

The 12 executives collectively hold nearly 70% voting power prior to the IPO.

Zuckerberg, who founded Facebook eight years ago, individually holds more than 28% of the total voting power before the IPO.

Separately, Facebook disclosed it generated net income of $1 billion in 2011 on revenue of more than $3.7 billion. Revenues included $3.15 billion in advertising and $557 million in payments and fees. The latter would include nascent studio efforts to offer transactional video-on-demand movies.

The site also said it has 845 million monthly active users contributing 2.7 billion “likes” and comments per day. There are 100 billion “friends” on Facebook.
 

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