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[Newsmaker] Kakao in spotlight for fat paychecksBy 이선영
Published : Dec. 23, 2015 - 17:14
Kakao, Korea’s fast-sprawling mobile empire built on the omnipresent phone messaging service KakaoTalk, is in the public spotlight for fat paychecks.
The KOSDAQ-listed firm was the highest-paying workplace among the top 100 companies by market capitalization in Korea last year, leading by a big margin a pack of older and larger corporate players such as Samsung Electronics.
According to data compiled by CEO Score, an online business information provider, Kakao employees took home an average of 174 million ($148,600) in total compensation in 2014, with the figure encompassing base salary and other forms of pay, such as bonuses and stock options exercised.
At 107 million won, Shinhan Financial Group came in second, followed by KB Financial Group, Samsung Electronics and SK Telecom, all at around 102 million won.
Kakao’s average compensation was 22 million won higher than that of Keyence Corp., a Japanese sensor-maker that topped the country’s corresponding list of highest-paying companies.
The hefty staff compensation at Kakao is seen as a reflection of the dazzling strides the company has made in its rise from the maker of a mobile chatting app into a 7 trillion won business empire and the most prominent and influential player in the ever-evolving mobile space.
Kakao, however, stressed that the 2014 figure was driven significantly higher by a one-off factor -- its merger with the country’s second-largest portal Daum and the subsequent backdoor listing of then-unlisted Kakao on the KOSDAQ bourse, which was a windfall for some founding members. The average amount is a far cry from what rank-and-file employees take home, it added.
“After the merger, some executives cashed in on their stock options, which resulted in an uptick in the average compensation level,” the company explained.
According to local reports, the average salary of Kakao workers was 98 million won last year right before the merger and a long-time Kakao executive alone earned 14 billion won by exercising his stock options after the floatation of Kakao shares through the merger.
Founded in 2006 by Kim Bum-soo and now headed by 35-year-old CEO Rim Ji-hoon, Kakao is undoubtedly Korea’s most prominent and successful start-up of the past decade.
With its mobile chat app now almost ubiquitous among local smartphone users, the company has been trying to turn the KakaoTalk platform and its 170 million user base toward new avenues like shopping, media, payments and even Uber-like taxi services. The company, along with telecom operator KT Corp., is poised to launch the country’s first two online-only banks.
Its performance this year has been disappointing though, with the third-quarter operating profit dropping 38.8 percent on-year to 67.9 billion won.
By Lee Sun-young (firstname.lastname@example.org)
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