When Snap filed documents last week for its IPO filing, among the interesting snippets that emerged was the cost of security for its CEO Evan Spiegel: a somewhat extraordinary $890,000.
What does $890,000 buy you in terms of security and why it is necessary for the CEO of Snapchat to have that degree of protection? And how does that compare to other tech CEOs?
Perhaps unsurprisingly, companies are not all that keen on explaining exactly where the money goes, beyond the legal requirements to let the SEC know the amount. But it is a safe bet that most costs fit into one of three buckets:
- Protecting the CEO's home (often homes)
- Bodyguards, and
- Costs of travel and protection while travelling
When it comes to security, it all depends on the number of people that a CEO feels he needs to protect him. Most people don't tend to run into tech CEOs very often, but based on The Register's experience, typically a top CEO will have two to four guys with him when in public – depending on how big and public the event is.
The cost of a four-man team, according to those who know, is between $15,000 to $20,000 a week. Few CEOs have a permanent security detail. So the cost is largely built around how much time they spend on the road, the size of their ego, and how paranoid they are.
Then there's home security: obviously a big concern, especially if there are children. And the cost depends on two main things: an initial security upgrade, and the size of the property. There is often a big initial cost to install new systems that can be anywhere from $25,000 to $50,000, and then there are ongoing security needs. And the larger the property, the more it costs to secure.
Then travel. Sometimes companies will include the costs of a corporate private jet into security costs – sometimes they just view that as a company cost. If the CEO travels to countries seen as dangerous, the degree of security is increased. But it typically comprises one or two vehicles – sometimes armored or specially protected cars that are sold custom by high-end companies like Mercedes-Benz.
Hey big spender
So who spends the most on security? Facebook CEO Mark Zuckerberg.
SEC filings show the social media giant spent a whopping $4.26m on our Mark last year. And that was less than the year before, when it spent $5.6m protecting him.
Just for comparison, the next most expensive security arrangement is Jeff Bezos at the very healthy $1.6m.
Zuckerberg is notoriously private and, let's be honest, more than a little paranoid. Somewhat unusually he bought the four houses around his Silicon Valley home for $30m back in 2013. The full details of the deal aren't known but it is believed that the owners agreed to sell their houses to Zuckerberg at a significant mark-up and lease them back from him and continue to live there. The only stipulation is that Zuckerberg gets to decide who lives there in the event they decide to move.
That level of paranoia was also evident earlier this year when Zuckerberg took a group of Hawaiians to court in an effort to force them to sell small pieces of land on his huge 750-acre property. Their ownership of small slices grants them an access right. There's no evidence they used it but the Zuck was paranoid enough to believe it was a problem and sued to force sales – something that he backed down from when it garnered a lot of local anger and press coverage.
The cost of a permanent four-man security detail would be around $1m. So Zuckerberg is still spending an additional $3.3m on something. Presumably he has a very expensive security system at both his homes – and it's safe to assume a constant security presence at both of them. And, we're willing to bet he has heavy additional security whenever he's out the country. Quite why he feels that is necessary when other tech CEOs in the same position don't can only be down to paranoia.
As for the cheapest. To our reckoning Tim Cook comes in at a bit of a bargain at just $220,000, seeing as he is one of the most recognizable CEOs in the world.
But just to put things in context: Equilar has been doing an annual study of Fortune 100 executives and their security expenses every year for over a decade. For 2016, it found the median cost for a top CEO on security was $126,550.
That means Mark Zuckerberg spends 33 times as much as the average top CEO on his security. If you take a look at the tech CEOs and their security costing below, and based on what we know of them (having met nearly all of them at some point), there is one factor that helps discern the wildly different costs. Yep, it's ego. ®
- Mark Zuckerberg (Facebook): $4.26m
- Jeff Bezos (Amazon): $1.6m
- Larry Ellison (Oracle): $1.53m
- Marc Benioff (Salesforce): $1.45m
Middle but still massive ego
- Evan Spiegel (Snap): $890,000
- Marissa Mayer (Yahoo): $545,000
- Eric Schmidt (Google): $360,000
- Tim Cook (Apple): $210,000
- Mark Hurd (Oracle): $176,000
Fortune 100 CEO-sized ego
- Jack Dorsey (Twitter): $112,000
- Brian Krzanich (Intel): $65,000