The billionaire with a cult following you have probably never heard of
By Brody Ford and Tom Maloney
Frank Slootman, who just stepped down as Snowflake chief executive officer, isn’t a name that springs to mind as one of the tech industry’s most prominent CEOs. But Slootman has parlayed his time atop three companies into a net worth higher than tech leaders like Apple’s Tim Cook or Microsoft’s Satya Nadella.
As Slootman leaves his CEO post at the software company, he has a fortune of about $US3.7 billion ($5.7 billion), according to the Bloomberg Billionaires Index. That tops Cook, who is worth about $US2 billion, and Nadella, who was not yet a billionaire as of July 2023.
Frank Slootman is the rare non-founder of a company to amass a massive fortune. Credit: Getty
It’s rare for a non-founder in the tech industry to amass that level of wealth — Slootman did it by leading Snowflake and ServiceNow through initial public offerings and was head of data-storage firm Data Domain when it was taken over by EMC Corp. in 2009.
Along the way, he developed a cult-like reputation in the software industry for being a tough leader with a to-the-point communication style. CEOs need to be “insanely confrontational,” he said in an episode of the No Priors podcast in 2023.
“Frank understands how hard it is to build companies and he’s done it repeatedly,” said David McJannet, CEO of HashiCorp Inc., another software infrastructure company, in a September interview. “People like that are relatively unflinching in their views and they are right a lot of times, so people tend to want follow them.”
The news he was leaving the CEO role alongside an underwhelming sales outlook caused Snowflake stock to plummet 18 per cent Thursday, marking its worst day ever. That drop alone dented Slootman’s net worth by about $US500 million. The company declined to comment on his net worth.
“It is no doubt concerning to see Mr. Slootman, who has a strong track record and is well regarded by investors, step down after five years in the role,” wrote Brad Zelnick, an analyst at Deutsche Bank AG, in a note Thursday.
Another analyst, Bernstein’s Mark Moerdler, wrote that he wondered if the sudden change was due to recent disappointments in the company’s revenue growth. Slootman said in an interview with Barron’s that the idea his departure was related to a poorly received growth guidance was an “absurd notion.”
Over the last four years, Slootman has sold shares at an average weighted price of about $US268 — well above the drop to $US188. He first joined Snowflake in 2019, and led the company through what was the largest software IPO ever the following year. At one point his stock awards were worth $US108 million per month.
His statements have elicited controversy. In 2021, Slootman was criticised for saying that diversity goals were secondary to merit in hiring, though he later apologised, saying he didn’t intend to imply that diversity and merit were mutually exclusive. He has donated to Republican and Libertarian politicians, including in Montana, where he spends much of his time and Snowflake relocated its executive office to in 2021.
Slootman’s net worth dwarfs that of Microsoft chief Satya Nadella.Credit: Bloomberg
Slootman’s replacement, Sridhar Ramaswamy, a former executive at Alphabet’s Google, is seen as a technical leader. Ramaswamy will be awarded about $US100 million in stock awards over the next five years in addition to a $US750,000 annual salary, according to a filing Wednesday. He’ll also get an annual incentive bonus targeted at 100 per cent of his salary.
Other non-founders who became billionaires through leading tech companies include Steve Ballmer, one of Microsoft’s first salespeople who went on to become CEO, and is now the sixth-richest person on the Bloomberg Billionaires Index. Palo Alto CEO Nikesh Arora recently became a billionaire as the company’s share price has surged.
Bloomberg
The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.