Zappo's deal is sweet redemption for low-paid shoe grunts
Jul 22nd 2009 9:00PM
Updated Dec 4th 2009 6:43PM
With Amazon (AMZN) reportedly offering $40 million cash and stock to Zappo's employees, Hsieh's troops are finally looking like real money. So how much does that tally up to per Zappista?
Let's say that $10 million of those rewards go to top management. That's a fairly conservative estimate, as top management likely already had options in Zappos but just to make sure we're in the ball park we'll assume $30 million. Divide that by 1,500 and the average payoff to a Zappista is a cool $20,000 -- or, in many cases, roughly one full year salary. If you assume that the entire $40 million goes to those below management --not a terrible assumption, as most of management probably did have some nice options tallied up-- then the grunts would get $26,666 on average.
Considering that the Las Vegas metro area is among the hardest hit in the country by the foreclosure crisis and the state's gambling economy is in a tail spin due to the dearth of Americans with pocket money and corporate junkets, the folks at Zappos could be excused for feeling a little smug. It seems that sticking to a shoe leather existence for years (Zappos is legendary for employee retention) even amidst the previously booming Nevada economy was exactly the right strategy.