SF tech CEO retires amid backlash, still will cash out millions

John Riccitiello, CEO of San Francisco-based gaming giant Unity Technologies, is suddenly leaving the company, but he shouldn’t be in financial trouble any time soon.

Unity announced the executive’s retirement Monday, just weeks after the company unveiled and then walked back an extremely unpopular pricing change. Effective immediately, Riccitiello is leaving his roles as CEO and president of the firm and chairman of its board after nine years at the helm. But he’ll stay on as an employee until April 2024 — and collect a pretty penny in the process.

A Securities and Exchange Commission document released Tuesday revealed Unity’s plan for Riccitiello’s transition. The company will keep paying Riccitiello his base salary — which was $380,016 last year, according to a separate SEC filing — through April 9.

For the executive, there’s a real benefit to staying on for six more months. Riccitiello’s complicated pay package is set up to deliver certain chunks of stock at certain dates. That means that as long as he remains employed, he collects, and can eventually cash out, huge sums. On Nov. 25, he’ll get 41,305 shares. If he sells at Unity’s current $30 stock price — which has stayed relatively steady for the past year — that’s a cool $1.2 million. 

The extra time will also grant Riccitiello hundreds of thousands of stock “options,” which let an employee buy shares at a set price. One batch lands on Dec. 31, offering him shares at around $11 a pop, and another on March 31, 2024, for around $20 a share. Since both are lower than Unity’s current stock price, a sale of the eventual shares represents a huge potential profit; at the current stock price, Riccitiello would clear around $8.4 million from the two windfalls.

Though the firm’s stock is trading at less than a fourth of its late 2021 value, Unity is still valued at around $11.5 billion. The firm reported that as of this April, Riccitiello held 2.2% of its shares — currently worth around $253 million.

The tech firm’s tools for developing video games turned it into an industry juggernaut, with about 7,600 employees and over a billion dollars in revenue last year, per company filings. Unity has also amassed a base of developers familiar with its programming language and tools — a group that was enraged when, on Sept. 12, Riccitiello and Unity proposed charging some developers a fee for each user installation versus a fixed annual fee, according to the New York Times. 

The backlash was swift and intense, particularly from smaller game-makers. The team behind hit game Among Us said it would leave Unity, and the San Francisco Chronicle reported that a threat forced Unity to temporarily shutter its downtown office. (The Chronicle and SFGATE are both owned by Hearst but have separate newsrooms.) Unity quickly bumped the fee threshold to exclude more small developers, apologizing on Sept. 17 for “the confusion and angst” caused by the original policy.

Riccitiello already had a mixed relationship with Unity’s customers. In July 2022, he was forced to apologize for a comment about developers who resist monetization that he made in an interview with PocketGamer.biz.

“Some of these people are my favorite people in the world to fight with — they’re the most beautiful and pure, brilliant people,” he had told the outlet. “They’re also some of the biggest f—king idiots.”

In a survey of a batch of Unity workers run by the forum site Blind in August, Riccitiello scored just a 2% approval rating.

Hear of anything happening at Unity or another tech company? Contact tech reporter Stephen Council securely at [email protected] or on Signal at 628-204-5452.