Varun Krishna
Rocket CompaniesAbout Varun Krishna
Varun Krishna is the Chief Executive Officer of Rocket Companies (RKT) and a member of the Board of Directors; he became CEO in September 2023 and has been a director since December 2023. He is 43 years old and holds a Bachelor’s degree in Computer Engineering from the University of Waterloo. In 2024, Rocket delivered adjusted revenue of $4.9B (+30% YoY) and adjusted EBITDA of $862M (18% margin), reflecting efficiency gains and market-share growth; in Q3’25, the company reported adjusted revenue of $1.78B, adjusted net income of $158M, and adjusted EBITDA of $349M as it closed the Mr. Cooper acquisition and advanced AI initiatives. Governance remains controlled-company style under founder Dan Gilbert as Chair, with Krishna serving as a non-independent management director.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Intuit | EVP & GM, Consumer Group; SVP & GM, Growth Products; SVP & GM, Mint; VP Product, TurboTax | 2015–2023 | Oversaw end-to-end consumer and tax products (TurboTax, TurboTax Live), driving product growth and client experience. |
| PayPal | Executive roles (not specified) | n/d | Product and fintech operating experience prior to Intuit. |
| Groupon | Executive roles (not specified) | n/d | Consumer tech and growth operating roles. |
| BetterWorks | Executive roles (not specified) | n/d | Enterprise/product leadership experience. |
| Microsoft | Early career product roles | n/d | Product lines/features oversight early in career. |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| — | — | — | No other public-company directorships disclosed for Krishna. |
Fixed Compensation
| Component | 2024 Value |
|---|---|
| Base Salary ($) | 1,250,000 |
| Annual Target Bonus (% of base) | 150% |
| Actual 2024 AIP Bonus ($) | 2,606,250 |
| CEO 2024 Stock Awards (Grant-date Fair Value, $) | 21,995,304 |
Notes:
- 2024 “say-on-pay” support was 99.4%, and 94% of CEO target pay was variable.
- Executive perquisites included limited relocation/commuting support; minor tax gross-ups were paid on certain perqs ($3,768 for Krishna in 2024).
Performance Compensation
Annual Incentive Plan (AIP) – Design and 2024 Outcomes
- Metrics and weights: Adjusted Revenue (33%), Adjusted EBITDA (33%), Company Scorecard (Execution/Client/Culture) (33%). Dynamic goal-setting scaled to market size; payouts 0–200% per metric.
- 2024 Payouts by metric: Revenue 143%, EBITDA 200%, Scorecard 73% → total payout 139% of target.
| AIP Metric (2024) | Weight | Threshold | Target | Max | Actual Performance | Payout |
|---|---|---|---|---|---|---|
| Adjusted Revenue | 33% | $3.610B (80% tgt) | $4.512B | $5.414B (120% tgt) | $4.902B | 143% |
| Adjusted EBITDA | 33% | $0.321B (60% tgt) | $0.534B | $0.748B (140% tgt) | $0.862B | 200% |
| Company Scorecard | 33% | — | — | — | Progress below target | 73% |
| Total | 100% | — | — | — | — | 139% |
Krishna’s 2024 AIP bonus was $2,606,250 (base $1.25M x 150% target x 139%).
Long-Term Incentives (LTI) – 2024 Awards and Structure
- 2024 LTI mix for CEO: 50% RSUs, 50% PSUs; total target grant value $16.875M with RSUs and PSUs each at $8.4375M.
- RSUs: vest in six equal semiannual installments over three years (each March 8 and September 8, starting Sep 8, 2024).
- PSUs: three-year cliff vesting, with payout 0–200% based on: 50% relative TSR vs a defined peer set; 40% Refinance Market Share Growth; 10% Purchase Market Share Growth; circuit-breaker requires positive cumulative adjusted EBITDA over first two years.
| 2024 PSU Metrics | Weight | Target Shares (CEO) |
|---|---|---|
| Relative TSR | 50% | 390,126 |
| Refinance Market Share Growth | 40% | 312,100 |
| Purchase Market Share Growth | 10% | 78,026 |
| Total Target PSUs | 100% | 780,252 |
Design updates for 2025 PSU plan: simplified market-share goal-setting to one-year growth goals (payout after 3-year cliff) and equalized refi/purchase weights (25%/25%); rTSR framework unchanged; participation broadened.
Equity Ownership & Alignment
- Beneficial ownership (5/20/25): 143,566 Class A shares (<1%).
- Outstanding/unvested awards (12/31/24): 650,210 unvested RSUs (market value $7,321,365 at $11.26), and 585,189 target PSUs (market value $6,589,228 at $11.26).
- Stock ownership guideline: CEO 6x base salary; five-year compliance window; all NEOs met or were on track by 12/31/24.
- Hedging/pledging: insider trading policy prohibits short sales and speculative options; long-term hedges allowed with pre-clearance; pledging permitted subject to policy safeguards.
| Ownership Detail | Amount |
|---|---|
| Class A Shares Beneficially Owned | 143,566 (<1%) |
| Unvested RSUs (12/31/24) | 650,210; $7,321,365 at $11.26 |
| Unearned PSUs at Target (12/31/24) | 585,189; $6,589,228 at $11.26 |
| Options (Exercisable/Unexercisable) | None disclosed for CEO |
| CEO Ownership Guideline | 6x base salary; 5-year window; on track |
| Hedging/Pledging Policy | Short sales/options prohibited; long-term hedges with pre-clearance; pledging allowed with safeguards |
Vesting Schedule and Potential Selling Pressure
- RSUs vest semiannually in equal tranches; CEO’s 2024 RSU grant of 780,252 shares vests ~130,042 shares per installment (first vested 9/8/24, as reflected by 130,042 shares vested in 2024).
- Next scheduled RSU vest dates: Mar 8, 2025; Sep 8, 2025; Mar 8, 2026; Sep 8, 2026; share counts per installment ~130,042; actual value subject to share price and blackout/pre-clearance under policy.
Employment Terms
| Term | Detail |
|---|---|
| Start date and roles | CEO since September 5, 2023; Director since December 2023; appointed to succeed as President of Rocket effective Dec 31, 2025 (no change to compensation). |
| Base salary and bonus target | $1.25M base; 150% target bonus. |
| Sign-on | $2.0M sign-on bonus at hire (2023). |
| 2024 annual equity | $16.875M target (50% RSUs, 50% PSUs); RSU/PSU share counts per method in agreement. |
| Non-compete / Non-solicit | 18 months post-termination; confidentiality and non-disparagement covenants apply. |
| Severance (without Cause / for Good Reason) | Lump sum 2x base salary; 18 months health benefits; 12 months accelerated vesting of time-based RSUs; pro-rated PSUs based on actual performance. |
| Change-in-control (CIC) | Double trigger: if terminated without Cause/for Good Reason within 18 months post-CIC or awards not assumed, unvested RSUs vest; PSUs vest at earned level (or target if undetermined). Death/disability accelerates RSUs; PSUs vest pro rata post-performance period. |
| Clawback | NYSE/SEC-compliant clawback policy for erroneously awarded incentive compensation (effective for compensation on/after Oct 2, 2023). |
| Hedging/pledging policy | See Equity Ownership & Alignment. |
Board Governance
- Role: CEO and Director (Class III, term expiring 2026); not independent and not listed on board committees.
- Structure: Controlled company under NYSE rules; not required to have majority-independent board or fully independent compensation/nomination committees; audit committee is fully independent.
- Committees: Audit (Mariner-Chair, Shank, Tellem); Compensation (Rizik-Chair [non-independent], Mariner, Tellem); Nominating & Governance (Rizik-Chair, Shank, Jennifer Gilbert).
- Attendance: Board met 5 times in 2024; each director attended at least 75% of applicable meetings; independent directors meet in executive session at least annually.
Performance & Track Record
- 2024: Adjusted revenue $4.9B (+30% YoY); adjusted EBITDA $862M (18% margin); adjusted diluted EPS $0.23; origination volume up nearly 30%; servicing UPB +17% to $593B; AI automation saved 1M hours and $40M of efficiency gains.
- 2025 Strategic Transactions: Closed Redfin (July 2025) and Mr. Cooper (Oct 1, 2025) acquisitions; Mr. Cooper exchange increased Class A float to 35%, retired Nationstar legacy debt; combined platform targets sizable synergies and expanded servicing scale.
- Q3’25 results: Adjusted revenue $1.78B; adjusted net income $158M; adjusted EBITDA $349M; net rate lock $35.8B; closed originations $32.4B.
Compensation & Incentives – Analytical Takeaways
- Shift to pay-for-performance: 2024 introduced a metrics-based AIP and PSUs (50% of LTI at target), moving away from fully discretionary bonus and 100% RSU mix; CEO’s variable pay ~94% of target total compensation.
- PSU metrics align with value creation: rTSR (50%) plus market-share growth (50% combined) and an EBITDA “circuit breaker” underpin long-term alignment.
- AIP calibration: dynamic goals scaled to mortgage market size; 2024 outperformance on revenue and EBITDA drove a 139% payout, consistent with financial momentum.
- Governance checks: robust clawback; ownership guidelines (CEO 6x salary) with compliance runway; hedging/pledging restrictions; however, as a controlled company, compensation committee chair is non-independent (Rizik), a governance consideration.
Director Compensation (for Krishna as a director)
Krishna receives no separate director compensation as a management director; director retainers and RSUs apply to non-affiliated directors only.
Compensation Peer Group and Consultants
- Peer group includes fintechs, consumer finance, exchanges, and mortgage peers (e.g., Adobe, Ally, Airbnb, Block, Discover, eBay, Expedia, FIS, Fiserv, ICE, Intuit, PayPal, PennyMac, ServiceNow, SoFi, Schwab, Western Union, Visa, Zillow), used for benchmarking levels/mix and practices.
- Consultants: Korn Ferry (through most of 2024); Semler Brossy engaged Oct 2024 for 2025 program evolution.
Related Party/Control Considerations
Rocket is a controlled company under NYSE rules with significant related party transactions and structural features (e.g., tax receivable agreement, Up-C collapse plan, RHI relationships), overseen via an RPT policy; these create potential governance and liquidity considerations for investors independent of Krishna’s personal incentives.
Investment Implications
- Alignment and retention: Krishna’s package is heavily at-risk with multi-year PSUs tied to TSR and market-share growth, and sizeable semiannual RSU vests; severance is 2x salary with pro-rated PSUs and limited RSU acceleration, promoting retention but with predictable liquidity events around vest dates.
- Performance sensitivity: 2024 and Q3’25 metrics support the 2024 AIP overachievement and validate PSU pathways; continued delivery on AI-driven efficiency, purchase share gains, and integration of Redfin/Mr. Cooper is key to PSU realization.
- Governance risk discount: Controlled-company exemptions (non-independent comp chair), RHI relationships, and TRA obligations may warrant a governance discount, though independent audit oversight and a robust clawback/insider trading framework mitigate some risks.
- Trading signals: Semiannual RSU vest cadence (~130k shares/instalment for CEO’s 2024 grant) and policy-governed trading windows can create periodic supply; Form 4 monitoring is recommended around March/September vest dates.