Most workers at Internet start-ups spend years slaving away in darkened rooms, earning nothing and eating Cheetos, waiting for an IPO or buyout to make it all worthwhile.
The folks at Digital Entertainment Network -DEN – are doing it the other way around: they’re paying themselves a fortune up front.
The top nine executives will get a whopping $5.3 million in annual salaries, the company disclosed in its IPO filing with the Securities and Exchange Commission.
And the unheard of salaries and bonuses at the money-losing web site have got Los Angeles insiders buzzing.
The top four execs will pull down a combined $3.7 million a year, not including stock options, warrants, bonuses and advances.
Company officials did not return a call seeking comment on their executive compensation plan.
The highest-paid honcho at the company is president David Neuman, a former NBC executive who was the president of Walt Disney Network Television from 1996 to 1998.
Neuman, 39, will bring home $1.5 million a year on top of a $1 million bonus paid in January of this year.
He also has warrants and options to buy more than 500,000 shares of the company at prices ranging from $0.75 to $6.67 a share. Neuman already bought 266,289 shares of the company at the rock bottom price of $0.75 a share.
Two other big winners are longtime record execs Gary Gersh and John Silva. The pair – principals in the G.A.S. Entertainment Company, which reps the Beastie Boys, Beck and the Foo Fighters – will pull down $600,000 a year as presidents of en.music, a subsidiary of DEN.
The duo have also been advanced $1 million each and given 339,984 shares apiece.
The pair had shopped G.A.S. – a record label/artist management company – to all the majors before going to DEN.
Chief marketing officer Edward Winter will pull down $1 million in salary and a bonus based on how much advertising he brings in.
The Santa Monica-based company has no revenue, 146 employees and wracked up a net loss of $20 million in the six months ended June 30. Since it’s inception, the company has lost $27 million.
NICE WORK
Los Angeles insiders have been buzzing about the extravagant pay given executives at DEN, a money-losing entertainment website.
David Neuman, President, DEN… $1.5 million a year pay, $1 million bonus, Options to buy more than 500,000 shares.
Gary Gersh, President, >en.music… $600,000 a year pay, $1 million advance, 339,984 shares.
John Silva, President, >en.music… $600,000 a year pay, $1 million advance, 339,984 shares.
Edward Winter, Chief marketing officer… $1 mllion salary and bonus