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All those harried days juggling phone calls have paid off handsomely for Shannon Hermes.
Hermes now owns about $1.3 million worth of Google (GOOG, news, msgs) stock, the result of Google's acquisition of YouTube last year, according to a new regulatory filing by Google.
But this new millionaire isn't one of the founders of the video-sharing startup. Nor can she take credit for planting the venture-capital seed money that got it off the ground. Hermes, as it happens, is none other than the receptionist and office manager for YouTube.
It's well-known that Google's $1.65 billion purchase of YouTube made very rich men out of co-founders Chad Hurley and Steve Chen, who each received hundreds of millions of dollars' worth of Google stock. There's also been lots of attention paid to how Sequoia Capital, one of YouTube's original venture-capital backers, stands to make about $442.3 million from the deal.
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But what's emerging now is the dozens of less glamorous YouTube people pocketing multimillion-dollar rewards, at least on paper, from the acquisition. Most appear to have been with the company since it was founded in mid-2005, and they occupy positions far from the boardroom.
Aside from Hermes, there's Julie Supan, YouTube's chief spokeswoman, who received Google stock worth $4.9 million, according to the company's regulatory filing. Heather Nicole Gillette, YouTube's director of customer support, is facing a potential $4 million payday.
For helping to build YouTube's systems, Bradley Wayne Heilbrun has a potential $6.1 million payout. Christina Brodbeck, a senior user-interface designer, is now worth at least $8.9 million. For serving as a YouTube community advocate, Micah Jody Schaffer Shebar could cash out with $1.63 million.
"It's just mind-boggling," said Joe Capobianco, a mergers-and-acquisitions attorney with Reisman, Peirez and Reisman, a Garden City, N.Y., law firm.
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The allure of stock options
To Capobianco, the new class of YouTube millionaires serves as a dramatic, if unusual, reminder of the potential riches of stock options and may even add new luster to what is a relatively entrenched employee-recruiting technique.In publicly traded companies, stock options let employees buy a fixed number of shares at a price usually far below the publicly traded value. In private companies such as YouTube, they represent an ownership stake in the company.
To be sure, stock options have hardly fallen out of favor in Silicon Valley; they remain one of the chief ways companies compete for the best talent. In fact, Google itself is planning in April to let employees sell their options to the highest bidder, creating the potential for unlocking even more value from an already highflying investment.
But stock options also have gotten a bit tarnished by scandal in the past year, thanks to the hundreds of companies, largely in the technology sector, that backdated options of top executives in order to make the options more valuable.
"While the amounts here for YouTube employees are an isolated case, it shows how there continues to be a good reason to use stock options to attract employees," Capobianco said. "It's mind-boggling that a receptionist can get that type of stock options."
Moreover, Capobianco said, the payouts at YouTube harken back to the dot-com days of the late 1990s, when "stock was cheap money and companies were just throwing (it) around."
Various Google employees who benefited from the acquisition couldn't be reached for comment. A YouTube representative said the company was not commenting.
Google's regulatory filing also sheds light on some surprising recipients of Google stock. A trustee for Hewlett-Packard (HPQ, news, msgs), for instance, is getting about $44 million in Google stock. Also, Larry Probst, the chief executive of gaming company Electronic Arts (ERTS, news, msgs), has the rights to $2.3 million worth of Google stock.
This article was reported and written by Ben Charny for MarketWatch.
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