Sales & Marketing
Zoopla founder Alex Chesterman commits to future at company
4 min read
12 August 2015
Having set up the business alongside Simon Kain in 2007, serial entrepreneur Alex Chesterman has pledged his continued leadership at Zoopla for the “next few years” – and will soon be rewarded with an increased remuneration and new “value creation plan”.
Chesterman was part of the team that founded LOVEFiLM, a subscription film service that was ultimately sold to Amazon, and has taken Zoopla from inception to a member of the Main Market on the London Stock Exchange.
He initially build the business, which serves as an online platform for residential property listings, using venture capital funding from backers including Octopus Investments and Atlas Venture.
Chesterman oversaw the IPO of Zoopla in June 2014, and has now, though the company’s latest trading statement, announced his long-term commitment to continue to lead the business over the next few years.
As part of incentivising Chesterman to stay, the board will introduce a “value creation plan”, the details of which mean he will likely earn significantly more than he does now.
After a minimum eight per cent total shareholder return per annum is secured, Chesterman can earn anything up to £5m by taking options equal to three per cent of the value of the total shareholder returns above the eight per cent minimum.
If shareholder returns exceed 9.4 per cent, the CEO can earn anything up to 7.5m shares. A company statement revealed that 50 per cent of the cumulative balance of options can be exercised at the end of three years, conditional on the minimum return of eight per cent having been achieved in each of the previous years. Then, after four years, 100 per cent of the cumulative balance can be exercised based not the same terms.
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Chesterman has also been granted permission to sell up to a maximum of 4.25m shares, which represents one per cent to the company’s issued share capital. This can done over the coming months and is to settle personal tax and other liabilities.
“We have come a long way since our launch just seven years ago, but there still remains so much more to do that I am incredibly excited about. I am delighted to be able to fully commit to ZPG for the long-term and deliver the growth strategy of the group,” Chesterman commented.
Mike Evans, chairman of Zoopla, added: “We are delighted that Alex has committed to the business for the foreseeable future. His entrepreneurial and creative approach has been the driving force behind the growth of the business over the last few years and we believe will be instrumental in delivering enhanced shareholder value over the long-term.”
The latest Zoopla trading statement showed a return to growth in the second half of the financial year. Increased competition from the likes of OntheMarket.com meant that figures had suffered in the first half, but a net gain of 213 new estate agent branches between the beginning of April and end of July means it now has 12,556 signed up.
Its listings inventory grew seven per cent from 828,000 to 882,000, and the website now receives 45.6m monthly visits.
New acquisition uSwtich, which was bought in April, is now “trading well”. The price comparison website for home services including energy and communications was bought so that the combined offering could help consumers research, find and manage homes from a single platform.