Monday.com Investors Approve Doubling CEOs’ Salaries Amid Layoffs and Stock Decline

Monday.com’s shareholders approved a proposal on Thursday to gradually double the compensation packages of the company’s co-CEOs, Roy Mann and Eran Zinman, despite recent significant challenges including a sharp drop in the company’s stock price and a large wave of layoffs. The salary increase plan, set to take effect over three years until 2029, will raise each CEO’s total compensation from $7.3 million currently to $14.6 million. Their base monthly salary will increase from 93,000 shekels to 120,000 shekels, with equity compensation capped at $13.65 million by 2029.

The co-CEOs requested the raise in early July, just weeks before executing layoffs affecting approximately 620 employees. They argued that their salaries had not kept pace with the company’s growth since its IPO five years ago, during which revenues increased from about $300 million to over $1 billion annually. The company also highlighted that Mann and Zinman had voluntarily limited their annual salary increases to 3% and maintained fixed stock option grants of around $7 million per year, regardless of performance, which it described as unusual in the market.

Monday.com reported strong operational results, surpassing analyst expectations with $351 million in revenue in Q1 2024, a 24.5% year-over-year increase, and an adjusted net profit of $56 million. Q2 revenues, to be announced soon, are expected to reach approximately $355 million, potentially putting the company on track for $1.5 billion in annual revenue by the end of 2026. However, the company’s stock price has fallen dramatically, down about 38% since the start of the year and 47% since its 2021 IPO.

The decision to approve the salary increases has drawn scrutiny given the layoffs and the stock’s decline. Monday.com had previously insisted extensive layoffs were unnecessary but reversed course amid unclear statements about workforce strategy and the impact of AI on growth. The company faces competitive pressure from emerging AI-powered tools that could challenge its project management software offerings.

The board includes the two CEOs, Wix CEO Avishai Abrahami, major private investors such as Aviad Eyal from Entree Capital and Jeff Horing from Insight Partners (chairman), as well as independent directors from venture capital and cybersecurity sectors. The approval reflects investor confidence in the leadership despite recent operational and market challenges.