Michael Gianoni
BLACKBAUDAbout Michael Gianoni
Michael P. Gianoni, 64, is Chief Executive Officer, President, and Vice Chairman of Blackbaud, serving as CEO since January 2014 and appointed Vice Chairman in January 2024 . He previously held senior roles at Fiserv, CheckFree, and DST Systems, and is Chairman of Teradata’s Board; he holds an AS in electrical engineering, a BS, an MBA, and an honorary doctorate . In 2024, Blackbaud delivered total revenue of $1,155.5M (+4.5% YoY), 97.7% recurring revenue, and a Rule of 40 profile of 38.6% on a constant currency basis; company PEO “compensation actually paid” was $6.55M while the value of a $100 TSR investment measured in the PVP table was $93.03 and net loss was $(283.2)M . Say‑on‑pay support in 2024 was ~95%, and the Compensation Committee reduced the CEO’s 2024 STI payout to 50% of target despite formulaic results of 91.1%, signaling discipline .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Fiserv, Inc. | EVP & Group President, Financial Institutions | 2010–2013 | Led financial institutions segment at global fintech provider . |
| Fiserv, Inc. | President, Investment Services division | Dec 2007–2009 | Leadership of investment services post-acquisition of CheckFree . |
| CheckFree Investment Services | EVP & General Manager | 2006–2007 | Provided investment management solutions to financial organizations . |
| DST Systems Inc. | Senior Vice President | 1994–2005 | Senior leadership at technology-based service solutions provider . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Teradata Corporation | Chairman of the Board | Since Feb 2020 | Also a director . |
| Medical University of South Carolina | President’s Advisory Group member | N/A | Nonprofit advisory role . |
Fixed Compensation
| Year | Base salary ($) | Notes |
|---|---|---|
| 2022 | 795,876 | Annual changes typically effective July 1 . |
| 2023 | 800,031 | |
| 2024 | 800,031 | CEO target STI opportunity = 100% of base salary . |
Performance Compensation
2024 Short-term Incentive (STI) – PRSUs (vest in Feb 2025)
- Metrics equally weighted: Non-GAAP Adjusted Recurring Revenue; Non-GAAP Adjusted Income from Operations. Threshold must be met for payout; performance measured on constant currency .
- Formulaic payout factor: 91.1%; Committee exercised discretion to reduce CEO payout to 50% of target shares (earned 4,940 of 9,879 target) .
| Metric | Threshold | Target | Actual | Payout factor | CEO earned shares |
|---|---|---|---|---|---|
| Non-GAAP Adj. Recurring Revenue ($M) | 1,041.3 | 1,157.0 | 1,123.8 | 91.4% | 4,940 (50% of 9,879) |
| Non-GAAP Adj. Income from Operations ($M) | 294.3 | 327.0 | 317.1 | 90.8% | 4,940 (50% of 9,879) |
Grant detail:
- 2024 STI PRSUs grant date: Feb 22, 2024; target 9,879; vesting on Feb 22, 2025, subject to service .
2024 Long-term Incentive (LTI)
Structure: 50% time-based RSAs/RSUs (3-year ratable vesting), 50% PRSUs split equally between one-year (Revenue, Gross Dollar Retention) and three one-year Rule of 40 tranches (FY24–26), each tranche vesting post-certification per schedule .
2024 grants (Feb 21, 2024):
- RSAs/RSUs: 64,521 (time-based, 1/3 annually) .
- PRSUs (one-year): 32,261 target .
- PRSUs (three-year): 32,261 target (Rule of 40 measured in FY24, FY25, FY26) .
One-year PRSUs (2024 performance) results:
| Metric | Threshold | Target | Actual | Payout factor | CEO earned PRSUs |
|---|---|---|---|---|---|
| Non-GAAP Adj. Total Revenue ($M) | 1,064.7 | 1,183.0 | 1,150.1 | 91.6% | 29,456 |
| Gross Dollar Retention (%) | 88.3% | 91.3% | 89.5% | 91.0% | 29,456 |
Three-year PRSUs – first-year (FY2024) Rule of 40 result:
| Performance period | Threshold | Target | Actual | Payout factor | CEO earned PRSUs (FY24 tranche) |
|---|---|---|---|---|---|
| Rule of 40 FY2024 | 36.0% | 40.0% | 38.6% | 94.2% | 10,131 |
Prior multi-year PRSUs (earned based on FY2024 Rule of 40):
| Grant year | Target PRSUs tied to FY2024 | Payout % | CEO earned PRSUs |
|---|---|---|---|
| 2023 | 10,893 | 135.5% | 14,761 |
| 2022 | 9,717 | 157.3% | 15,285 |
Grant date fair value detail (2024):
| Component | Target grant date fair value ($) |
|---|---|
| 2024 STI PRSUs | 668,611 |
| 2024 LTI PRSUs (one-year) | 2,185,038 |
| 2024 LTI PRSUs (three-year) | 2,185,038 |
| 2024 RSAs/RSUs | 4,370,007 |
| Total 2024 stock awards (SCT) | 9,408,693 |
Equity Ownership & Alignment
- Beneficial ownership: 387,985 shares (<1% of outstanding) as of April 14, 2025; total shares outstanding 48,518,682 .
- CEO stock ownership guideline: lesser of 4x salary in shares (43,290) or 70,000; owned 344,079 for guideline purposes (8x multiple) as of Dec 31, 2024 .
- Hedging/pledging: Company prohibits pledging and hedging of company securities; directors and Section 16 officers may not pledge .
- Upcoming/ongoing vesting inventory (as of Dec 31, 2024):
- 2024 STI PRSUs: 4,940 earned; vest Feb 22, 2025 .
- 2024 RSAs/RSUs (time-based): 64,521 unvested (3 equal annual tranches from Feb 21, 2025) .
- 2024 One-year PRSUs: 29,456 earned; vest in 3 equal annual installments beginning Feb 21, 2025 .
- 2024 Three-year PRSUs: 10,131 earned for FY2024 tranche; future FY25–26 tranches unearned (targets 21,507 and 21,786 shown as unearned counts) .
- Insider activity context: Company disclosed 2024 repurchases of ~10% of shares outstanding (≈11% including net share settlement of employee stock comp), and plans 3–5% buybacks in 2025—this can mitigate net-share-settlement selling pressure from vesting events .
Employment Terms
| Term | Key terms |
|---|---|
| Agreement | Amended & Restated Employment and Noncompetition Agreement (Sept 20, 2022), First Amendment (Mar 10, 2025); initial term Jan 1, 2023–Dec 31, 2025; non-compete and non-solicit 12 months post-termination . |
| Termination without cause / good reason (no CIC) | Accrued comp; settle vested STI; 24 months base salary; lump-sum cash equal to average value of prior two years’ STI equity awards pro‑rated; 12 months acceleration of time-based equity; performance equity accelerates only if performance period ends within 12 months of termination; vested options/SARs exercisable per award terms; severance conditioned on release . |
| CIC double-trigger (within 12 months post-CIC) | Same as above plus full acceleration of time-based equity; performance equity accelerates at actual achievement as of termination or target if not determinable; COBRA reimbursement up to 12 months; conditioned on release . |
| Death/Disability (post-amendment) | Accrued comp; settle vested STI; full acceleration of time-based equity and performance equity at actual achievement as of termination or target if not determinable . |
| Clawback | Individual agreement references company clawback; company adopted Dodd‑Frank Rule 10D‑1 compliant policy in Oct 2023 . |
| 280G | “Cut-back” to avoid excise tax if beneficial vs paying excise tax; no tax gross‑ups . |
Quantified potential payouts (assuming Dec 31, 2024 termination at $73.92/share):
| Scenario | Cash salary ($) | Lump-sum STI avg ($) | Equity acceleration ($) | COBRA ($) | Total ($) |
|---|---|---|---|---|---|
| Termination without cause/good reason (no CIC) | 1,600,000 | 743,027 | 9,273,634 | — | 11,616,661 |
| Death/Disability (pre‑amendment measurement) | — | 743,027 | — | — | 743,027 |
| Death/Disability (if First Amendment effective 12/31/24) | — | — | 19,583,995 | — | 19,583,995 |
| CIC double-trigger | 1,600,000 | 743,027 | 18,853,740 | 16,268 | 21,196,767 |
Board Governance
- Current roles: CEO, President and Vice Chairman; non‑independent director; no committee memberships .
- Board structure: Independent Chair (Andrew M. Leitch); 88.9% independent board; 100% independent committees; regular executive sessions .
- Committees: Audit, Compensation, Nominating & Corporate Governance, and Risk Oversight—all independent .
- Attendance: All directors attended ≥75% of Board and committee meetings in 2024 .
- Dual-role implications: Separation of CEO and Chair positions maintained; Vice Chairman title with independent Chair and independent committees mitigates independence concerns .
Director Compensation
- Director fees apply to non‑employee directors only; the CEO does not receive director retainers .
Say-on-Pay & Shareholder Feedback
- 2024 Say‑on‑Pay approval: ~95% of shares present and entitled voted FOR the 2023 NEO pay .
- Committee retained Compensia as independent consultant; continued use of ≥50% performance-based LTI and applied downward discretion to STI in 2024 .
Compensation Structure Analysis
- Mix and at-risk pay: CEO 2024 compensation heavily equity-based; $9.41M in stock awards vs $0.80M base salary .
- Shift toward PRSUs: At least 50% of LTI in PRSUs; 50% of PRSUs measured over multi-year periods—aligns with multi-year performance (Rule of 40) .
- Metric rigor and discretion: 2024 STI metrics near target (91.1% formulaic), but CEO payout cut to 50% of target; One-year LTI metrics paid at ~91%; multi-year FY2024 tranches at 94.2% (2024 grants) and above target for earlier grants—evidence of outcome differentiation .
- Clawback, hedging/pledging prohibitions, and no option repricing without shareholder approval strengthen governance .
Performance & Track Record
| Measure | 2024 result |
|---|---|
| Total Revenue | $1,155.5M (+4.5% YoY) |
| Recurring Revenue | 97.7% of total |
| Rule of 40 (constant currency) | 38.6% (vs. 37.1% in 2023) |
| PEO Compensation Actually Paid | $6,547,279 |
| TSR (value of $100 investment, PVP table) | $93.03 |
| Net (loss) income | $(283.2)M |
Risk Indicators & Red Flags
- Related party transactions: None >$120,000 since Jan 1, 2024 .
- Hedging/pledging: Prohibited for directors and officers .
- Option repricing: Prohibited without shareholder approval .
- Potential CIC payout magnitude: ~$21.2M estimated at 12/31/24 share price .
- Insider selling pressure: Near-term vesting of earned PRSUs (Feb 2025) can create tax‑withholding sales; company’s active buyback (3–5% plan in 2025) partially offsets dilution/supply .
Equity Ownership & Vesting Detail (CEO snapshot at 12/31/24)
| Category | Counts / value |
|---|---|
| Beneficially owned shares | 387,985 (<1%) |
| Owned for guideline calc | 344,079; 8x guideline |
| Unvested time-based RSAs/RSUs | 64,521 (grant 2/21/24) |
| Earned 2024 STI PRSUs | 4,940; vest 2/22/25 |
| Earned 2024 One‑year PRSUs | 29,456; 3 annual tranches from 2/21/25 |
| Earned 2024 Three‑year PRSU FY24 tranche | 10,131; vests on 2/21/25 |
| Unearned future PRSU tranches (illustrative targets) | 21,507 / 21,786 for FY25/FY26 (subject to performance) |
Director/Executive Policies Relevant to Alignment
- Executive stock ownership guidelines: CEO 4x salary or 70,000 shares (whichever is less); all NEOs in compliance .
- Trading policy: Insider Trading Policy filed with 10‑K; robust controls .
- Clawback Policy (Oct 2023) compliant with Nasdaq Rule 10D‑1 .
Investment Implications
- Pay-for-performance alignment improving: Despite near-target operating metrics in 2024, the Compensation Committee applied negative discretion to the CEO’s STI to 50%, and one-year/three-year PRSUs settled near ~91–94% of target for FY2024 performance, indicating guardrails against windfalls and alignment with mixed TSR outcomes .
- Retention vs. supply overhang: The CEO holds significant unvested equity with scheduled vesting starting Feb 2025; while this supports retention, vesting can create short-term supply for tax withholding; the company’s 2025 buyback plan (3–5% of shares) can help absorb flow .
- Governance mitigants: Independent Chair, fully independent committees, prohibitions on pledging/hedging, clawback, and no repricing without shareholder approval reduce governance risk, while a “double-trigger” CIC structure avoids single-trigger acceleration risk .
- Change-in-control economics: Modeled CIC package (~$21.2M) is material and should be considered in event-driven scenarios; 280G cutback (no gross-up) modestly limits excess parachute effects .
- Ownership alignment: CEO exceeds ownership guidelines (8x) and holds <1% of shares outstanding, suggesting meaningful alignment without outsized control risk .