John Fesko
NateraAbout John Fesko
John Fesko is President, Chief Business Officer at Natera, appointed to the President/CBO role in September 2023 after serving as Chief Business Officer (January 2020–August 2023) and SVP, Business Development (January–December 2019); he joined Natera in February 2014 in business development roles. He is 46, holds an MBA from MIT and a BS in Biochemistry and Economics from the University of Notre Dame, and previously worked at Roche Molecular Systems, Novartis, MPM Capital, and InVivoScribe . Company performance under the 2024 plan featured total revenue of $1,696.9 million (+56.7% YoY), gross margin improvement to 60.3%, and operating cash flow of $86.5 million, driving a 119.1% company performance payout factor .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Natera | President, Chief Business Officer | Sep 2023–present | Executive leadership across commercial and corporate development |
| Natera | Chief Business Officer | Jan 2020–Aug 2023 | Led business development and commercial strategy |
| Natera | SVP, Business Development | Jan–Dec 2019 | Senior BD leadership |
| Natera | Business Development roles | Feb 2014–2018 | BD roles since joining (exact titles not itemized) |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Roche Molecular Systems, Inc. | Not disclosed | Not disclosed | Prior industry experience |
| Novartis Pharma AG | Not disclosed | Not disclosed | Prior industry experience |
| MPM Capital | Not disclosed | Not disclosed | Prior investing role |
| InVivoScribe, Inc. | Not disclosed | Not disclosed | Prior industry experience |
Fixed Compensation
| Metric | 2023 | 2024 | Notes |
|---|---|---|---|
| Base Salary ($) | $475,000 | $489,250 | 3% increase effective Jan 1, 2024 |
| Target Bonus (% of Base) | Not disclosed | 50% | Weighting: 80% company, 20% individual |
| Target Bonus ($) | Not disclosed | $243,436 | Prorated change effective Mar 1, 2024 |
| Actual Bonus Paid ($) | Not disclosed | $285,574 | Delivered as fully vested RSUs on Mar 12, 2025; value set using Mar 11, 2025 close |
Performance Compensation
Annual Cash Incentive – 2024 Company Metrics
| Metric | Weighting (%) | Threshold | Target | Maximum | Actual | Payout (% of Target) |
|---|---|---|---|---|---|---|
| Revenue | 55 | $1,103.47M | $1,298.2M | $1,142.93M | $1,969.6M | 120.0% |
| Product Gross Margin | 35 | 41.0% | 51.3% | 61.6% | 60.3% | 117.5% |
| Operating Cash Flow | 10 | $(126.1)M | $(100.9)M | $(75.7)M | $86.5M | 120.0% |
| Overall Company Factor | — | — | — | — | — | 119.1% |
Individual Performance Factor (Fesko)
| Executive | Individual Factor Weight | Achievement | Notes |
|---|---|---|---|
| John Fesko | 20% | 110% | Determined by HCC based on accomplishments |
2024 Bonus Outcome (Fesko)
| Executive | Target Bonus ($) | Company Payout ($) | Individual Payout ($) | Total Actual ($) | % of Target |
|---|---|---|---|---|---|
| John Fesko | $243,436 | $232,018 | $53,556 | $285,574 | 117.31% |
Long-Term Incentives – 2024 Grants (Fesko)
| Award Type | Grant Date | Units (#) | Target Grant Value ($) | Vesting | Performance Metric / Scale |
|---|---|---|---|---|---|
| PSUs | Jan 26, 2024 | 31,352 | $2,000,000 | 3-year performance period | 2024–2026 cumulative revenue; 95%/100%/105% → 50%/100%/200% payout |
| RSUs | Jan 26, 2024 | 31,352 | $2,000,000 | 4 years; 25% at 12 months, then quarterly | Time-based retention |
Prior Performance-Based Vesting (selected items impacting 2024–2025)
| Award Type | Grant Date | Vest Date | Units Vested | Trigger |
|---|---|---|---|---|
| PSU | Aug 12, 2022 | Aug 12, 2024 | 10,000 | Cash flow breakeven quarter achieved |
| PSU | Oct 22, 2021 | Dec 20, 2024 | 1,675 | Business milestone achieved |
| PSU | Jun 10, 2022 | Jan 16, 2025 | 10,822 | $300M cash burn and $1.1B revenue goals achieved |
| PSU | Jan 28, 2022 | Jan 16, 2025 | 13,696 | $1.1B annual revenue achieved |
| PSU | Jan 27, 2023 | Jan 16, 2025 | 14,899 | 2-year cumulative revenue goal achieved (40% tranche) |
Equity Ownership & Alignment
Beneficial Ownership (as of March 15, 2025)
| Holder | Direct Shares | Options/RSUs Vesting ≤60 Days | Total Beneficial | % of SO |
|---|---|---|---|---|
| John Fesko | 93,476 | 20,955 | 114,431 | <1% |
- Hedging and pledging of company stock are prohibited for employees and directors; executive stock ownership guidelines are in place (specific multiples not disclosed) .
- Outstanding unexercised options and unvested RSUs (as of Dec 31, 2024) for Fesko include multiple tranches; selected positions summarized below .
Outstanding Equity Awards (as of Dec 31, 2024)
| Award | Exercisable (#) | Unexercisable (#) | Exercise Price ($) | Expiration/Notes | Unvested RSUs/Equity (#) | Market Value ($) |
|---|---|---|---|---|---|---|
| Stock Option | 1,804 | — | 9.29 | 3/8/2028 | — | — |
| Stock Option | 1,725 | — | 15.57 | 3/7/2029 | — | — |
| Stock Option | 12,283 | — | 19.68 | 3/21/2029 | — | — |
| RSU (performance/time mix) | — | — | — | See footnotes | 501 | $79,308 |
| RSU | — | — | — | — | 4,280 | $677,524 |
| RSU | — | — | — | — | 7,214 | $1,141,976 |
| RSU | — | — | — | — | 20,952 | $3,316,702 |
| RSU | — | — | — | — | 31,352 | $4,963,022 |
| RSU | — | — | — | — | 13,696 | $2,168,077 |
| RSU | — | — | — | — | 10,822 | $1,713,123 |
| RSU | — | — | — | — | 29,798 | $4,717,023 |
Notes (vesting mechanics):
- 75% of certain RSUs vest upon achieving $1.1B revenue and 25% upon $300M cash burn; both achieved and certified Jan 16, 2025 .
- Multi-year cumulative revenue PSU tranches exist for 2025–2026 with target counts shown in the table, subject to certification .
2024 Exercises/Vesting (liquidity potential)
| Metric | Shares | Value ($) |
|---|---|---|
| Options exercised | 100 | $10,239 |
| RSUs vested | 44,113 | $4,295,525 |
Employment Terms
Severance Plan (adopted 2024; Participation Agreement executed)
- Cash severance: 6 months base salary; increases to 12 months if termination within 12 months post change in control (double trigger) .
- COBRA premiums: Company-paid up to 12 months .
- Equity acceleration (involuntary termination not in connection with CIC): Time-based awards accelerate by greater of 50% of unvested or forward-vesting as if 12 more months of service; PSUs accelerate proportionally based on actual performance and service fraction with an added 12 months service credit .
- Equity acceleration (termination within 12 months post CIC): Time-based awards 100% vest; PSUs: revenue milestones use board-approved forecasts; market cap milestones use transaction valuation; other milestones fully vest .
- Good Reason definition includes material reduction in authority, base salary reduction, or relocation >30 miles without remote option, with notice/cure periods; Cause and CIC definitions per CEO section apply .
Potential Payments (assuming CIC and termination on Dec 31, 2024)
| Scenario | Cash Severance ($) | COBRA ($) | Equity Acceleration ($) | Total ($) |
|---|---|---|---|---|
| Involuntary Termination (no CIC) | $244,625 | $35,027 | $21,744,602 | $22,024,254 |
| CIC Termination (double trigger) | $489,250 | $35,027 | $25,806,858 | $26,331,135 |
| CIC Acceleration Only | — | — | $8,598,223 | $8,598,223 |
Clawbacks and Other Policies
- Clawback: Incentive compensation subject to recoupment policy and applicable law .
- No excise tax gross-ups; no option/SAR repricing without shareholder approval .
Investment Implications
- Strong pay-for-performance alignment: 2024 annual incentive tied to revenue (55%), product gross margin (35%), and operating cash flow (10), with actual performance exceeding targets (119.1% factor), and bonus delivered as fully vested RSUs—aligning outcomes with shareholder value while creating near-term liquidity for insiders .
- Retention balanced with performance: 50/50 mix of PSUs and RSUs; PSUs on multi-year cumulative revenue with an aggressive 200% max payout at 105% of target, and time-based RSUs vesting over 4 years—anchoring both execution and retention .
- Change-in-control economics: Double-trigger cash and equity benefits; performance award treatment under CIC reduces uncertainty (forecast-based revenue determination, transaction valuation for market-cap awards), with substantial equity acceleration potential ($25.8M) signaling meaningful incentive continuity but also investor dilution risk if broadly applied .
- Ownership and selling pressure: Fesko beneficially owns 114,431 shares (<1% of SO), had 44,113 RSUs vest in 2024, and received March 2025 vested RSUs for bonus—raising potential short-term selling pressure; pledging/hedging prohibited, and ownership guidelines exist (multiples not disclosed) .
- Governance and shareholder support: Say-on-pay approval at ~94.5% in 2024 indicates broad investor alignment; compensation peer group targets long-term incentive value ~75th percentile—competitive but monitored by independent consultant (Aon) .