Sumi Ghosh
About Sumi Ghosh
Sumi Ghosh serves as President of Operations at Dutch Bros (BROS). He joined under an employment agreement effective December 15, 2023, is an at-will employee, and his current (2025) target pay design includes base salary, annual cash incentive, and annual RSU awards . Company performance during his early tenure: 2024 revenue reached $1.281 billion (+32.6% YoY) and Adjusted EBITDA was $230.3 million; system same-shop sales grew 5.3% for the year and 6.9% in Q4; 151 new shops opened (128 company-operated) . Dutch Bros’ 2024 pay-versus-performance table shows a total shareholder return (value of initial $100) of $142.80 as of year-end 2024 (IPO-to-date basis) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| — | — | — | Not disclosed in proxy filings |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| — | — | — | Not disclosed in proxy filings |
Fixed Compensation
| Item | 2024 | 2025 |
|---|---|---|
| Base Salary | $500,000 | $525,000 |
| Target Annual Bonus (% of Salary) | 60% | 60% |
| Target Annual Equity Award (Grant Value) | RSUs granted (see below) | $750,000 (target annual equity award) |
Performance Compensation
- 2024 annual bonus plan used company metrics with 50% weighting to Total Revenue and 50% to Adjusted EBITDA; both achieved above maximum, yielding a 200% payout factor .
| 2024 Plan Metric | Weight | Threshold ($000) | Target ($000) | Maximum ($000) | Actual ($000) | Payout |
|---|---|---|---|---|---|---|
| Total Revenue | 50% | 1,149.6 | 1,197.5 | 1,245.4 | 1,281.0 | 200% |
| Adjusted EBITDA | 50% | 171.0 | 190.0 | 209.0 | 230.3 | 200% |
- 2024 individual payout calculation:
| Executive | Base Salary ($) | Bonus Eligibility (% of Salary) | Payout Factor | Actual Bonus ($) |
|---|---|---|---|---|
| Sumi Ghosh (President of Operations) | 500,000 | 60% | 200% | 600,000 |
Notes:
- Adjusted EBITDA is defined by the company (non-GAAP); see reconciliation references in filings .
Equity Ownership & Alignment
- Equity awards (no stock options): Dutch Bros states NEO long-term incentives are RSUs; “no plans to grant stock options” since 2022 .
- Stock ownership guidelines: covered officers 3x base salary; measured annually; 5-year compliance window from January 16, 2025 (through January 16, 2030) .
- Pledging/hedging: company policy prohibits pledging, margin, hedging, and derivatives in company stock .
2024 RSU Grants (grant-date fair value and shares)
| Executive | Grant Date | RSUs (#) | Grant Date Fair Value ($) | Vesting |
|---|---|---|---|---|
| Sumi Ghosh | 3/1/2024 | 18,537 | 549,993 | 1/3 on each of 1st, 2nd, 3rd anniversaries |
| Sumi Ghosh | 3/1/2024 | 25,278 | 749,998 | 1/3 on each of 1st, 2nd, 3rd anniversaries |
| Total 2024 RSUs | — | 43,815 | 1,299,991 | — |
Outstanding Equity at 12/31/2024
| Executive | Grant Date | Unvested RSUs (#) | Market Value at $52.38 ($) |
|---|---|---|---|
| Sumi Ghosh | 3/1/2024 | 18,537 | 970,968 |
| Sumi Ghosh | 3/1/2024 | 25,278 | 1,324,062 |
- Beneficial ownership (as of 3/18/2025): Sumi Ghosh beneficially owned 10,321 Class A shares (<1% of shares outstanding) .
- Insider selling pressure context: RSUs vest annually over three years from the 3/1/2024 grant date; as units settle, shares may be withheld for taxes and/or become sale-eligible under trading windows and policies. Company prohibits pledging/hedging, and ownership guidelines may constrain sales until compliance is met .
Employment Terms
| Term | Details |
|---|---|
| Role/Start | President of Operations; employment agreement effective December 15, 2023; at-will |
| 2025 Target Pay Design | Base salary $525,000; target bonus 60% of salary; target annual equity award $750,000 (subject to committee approval/terms) |
| 2024 Signing Bonus | $250,000 signing bonus in 2024; repayable in full if resignation without “good reason” or termination for “cause” within 2 years; repayment condition lapses January 15, 2026 (timing per “respectively”) |
| Relocation/Other Perqs (2024) | Relocation reimbursements up to $200,000 plus tax gross-up and travel reimbursements initially; all other comp shows $271,848 including moving expenses ($268,328) |
| Clawbacks | SOX 304 plus Dodd-Frank-compliant recoupment policy covering NEOs |
| Trading/Alignment Policies | No pledging/margin/hedging; ownership guidelines (3x base salary; 5 years to comply) |
Severance and Change-in-Control (CIC) Economics (Severance Plan)
| Scenario | Base Salary Severance | Target Bonus Multiple | Pro-Rata Bonus | COBRA Premiums | Equity Acceleration |
|---|---|---|---|---|---|
| Regular Termination (without cause/for good reason; outside CIC period) | 12 months | — | Yes | 12 months | None |
| CIC Termination (regular termination within 24 months post-CIC) | 12 months | 100% | Yes | 12 months | 100% of unvested equity (performance-based at target) |
| Death/Disability | — | — | Yes | — | 100% of unvested equity (performance-based at target) |
Notes:
- “CIC termination” is double-trigger (termination during the CIC period), not single-trigger .
- CEO and other NEOs’ terms are included for plan context; Sumi Ghosh row as above .
Additional Context: Company Performance & Compensation Governance
- 2024 performance: revenue $1.281B; Adjusted EBITDA $230.3M; net income $66.5M; 151 new shop openings; system same-shop sales +5.3% (Q4 +6.9%); company-operated same-shop sales +6.8% .
- Pay-for-performance link: 2024 NEO bonuses paid at 200% based on exceeding revenue and Adjusted EBITDA goals .
- 2024 Say-on-Pay support: 97.4% in favor at 2024 annual meeting; Board considered in 2025 design .
- 2024 peer group for benchmarking included: WING, SHAK, JACK, DNUT, BJRI, DIN, WEN, PZZA, CELH, LOCO, FWRG, PBPB, Portillo’s, Chuy’s (acquired in Oct 2024) .
Compensation Structure Analysis
- Mix shift and risk: Dutch Bros emphasizes RSUs (service- and beginning in 2025, 50% market-based on 3-year relative TSR) rather than options, lowering risk to executives vs. options but maintaining alignment through vesting and performance conditions . No option grants planned .
- Bonus rigor: 2024 targets were exceeded; full 200% payout signals strong topline and EBITDA outperformance vs. plan (potentially pro-cyclical upside) .
- Tax gross-ups: Relocation reimbursements for Ghosh included tax gross-ups, a shareholder-unfriendly feature often flagged by governance observers .
Equity Ownership & Alignment Assessment
- Skin-in-the-game: Ghosh’s direct ownership is modest (10,321 shares), but unvested RSUs provide forward alignment; ownership guidelines (3x salary) should meaningfully increase required holdings over the next five years (compliance window through January 16, 2030) .
- Pledging/Hedging: Prohibited—reduces misalignment/hedging risk .
- Vesting-driven supply: Three-year ratable RSU vesting creates predictable vest dates which may influence selling windows (subject to taxes, policies) but guidelines can constrain dispositions pre-compliance .
Investment Implications
- Alignment: 60% target bonus tied to revenue and Adjusted EBITDA (both exceeded in 2024), plus multi-year RSUs and ownership guidelines, align Ghosh’s incentives with growth and margin expansion—the core drivers of BROS’ valuation .
- Retention: Multi-year RSU vesting, a two-year signing-bonus clawback through Jan 15, 2026, and robust severance/CIC protections (double-trigger equity acceleration) mitigate near-term retention risk during aggressive new shop rollout .
- Selling pressure: Upcoming annual RSU vests around each March 1 from 2025–2027 could add modest supply; mitigated by ownership guidelines and trading-policy constraints .
- Governance watch items: Relocation tax gross-up is a minor red flag; however, strong say-on-pay (97.4% in 2024) and the addition of market-based vesting for 2025 awards support pay-performance credibility .