David Steinberg
About David Steinberg
David A. Steinberg, 55, is Co-founder, Chairman, and Chief Executive Officer of Zeta, and has served on the Board since 2007. He holds a BA in Economics from Washington & Jefferson College and previously founded and led InPhonic and Sterling Cellular, bringing deep entrepreneurial and marketing experience to Zeta . Under his leadership in 2024, Zeta delivered 38% revenue growth to $1,005.8 million, with net cash from operations of $133.9 million; adjusted EBITDA reached $193.0 million, and a $100 initial investment at IPO-tracking date was worth $202.36 by 2024 year-end, illustrating improving financial performance and stock performance since listing . Steinberg controls approximately 53.7% of total voting power through ownership of all Class B shares, aligning incentives but concentrating governance power in management .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| InPhonic | Founder and Chief Executive Officer | Not disclosed | Built and led a seller of wireless phones and communications products/services; foundational operating and go-to-market experience . |
| Sterling Cellular | Chairman and Chief Executive Officer | Not disclosed | Early leadership in wireless distribution; entrepreneurial track record . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| CAIVIS Investment Company | Chairman | Not disclosed | Investment leadership; network and capital access . |
| Kica Investments | Chairman | Not disclosed | Investment leadership; strategic relationships . |
| On Demand Pharmaceuticals | Chairman | Not disclosed | Sector adjacency; potential innovation and talent network benefits . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 750,000 | 750,000 | 750,000 |
| Target Bonus % of Salary | Not disclosed | Not disclosed | 100% |
| Annual Cash Incentive Payout ($) | 750,000 | 750,000 | 750,000 |
| Discretionary/Other Cash Bonus ($) | 475,000 | 475,000 | 250,000 (Follow-On offering bonus) |
| Perquisites and Other ($) | 415,657 | 531,640 | 445,428 (incl. corporate apt $329,895; club fees $55,533 with $15,451 tax gross-up; executive healthcare $60,000) |
Notes:
- Zeta maintains an NYSE-compliant clawback policy covering incentive-based compensation for restatements .
- Anti-hedging and anti-pledging policies apply to directors and officers; no pledging exceptions approved to date .
Performance Compensation
Annual Incentive Plan (Cash)
| Component | 2024 Design | 2024 Outcome |
|---|---|---|
| Metrics | Revenue and Adjusted EBITDA (short-term growth alignment) | Paid at 100% of target for NEOs |
| Discretionary Bonuses | Follow-On offering bonus ($250k CEO); incremental bonuses for other NEOs based on exceeding budget (context for alignment) | CEO received $250k Follow-On bonus |
Long-Term Incentives (Equity)
-
2024 PSU grant: 1,343,850 target PSUs to CEO on 4/3/2024; earned 0–200% based on 20-day VWAP; vest 1/3 on determination date, remainder quarterly over 2 years; unearned PSUs expire 1/1/2029 .
-
2024 PSU Price-to-Payout Schedule:
20-Day VWAP % of Target PSUs Earned Below $10.30 0% $10.30 25% $11.64 50% $12.875 100% $17.00 150% $22.66 200% -
Prior PSU realization cadence (illustrates sensitivity to price): In 2024 the Company determined PSU earnouts using VWAPs of $10.61 (Q1), $16.49 (Q2), and $27.61 (Q3), which yielded varying earn-in percentages across 2021–2023 PSU tranches; earned PSUs vest over set annual schedules into 2026 .
| Equity Award | Grant Date | 2024 Status / Mechanics | Key Vesting Dates |
|---|---|---|---|
| PSUs (Target 1,343,850) | 4/3/2024 | Earn 0–200% vs VWAP grid; unearned expire 1/1/2029 | 1/3 at determination; then eight quarterly vests starting 5/12/2025; initial vest 2/12/2025 |
| PSUs (2023) | 4/21/2023 | Earn 0–300% vs quarterly VWAP; multiple 2024 determinations produced earned amounts | Vests in four installments across 2025–2026 (7/3 and 10/9 each year) |
| PSUs (2022) | 2/23/2022 | Earn vs quarterly VWAP through 2026; multiple determinations in 2024 | Vests in four installments across 2025–2026 (7/3 and 10/9 each year) |
| PSUs (2021) | 8/18/2021 | Earned to maximum; vests through 2026 per determination dates in 2023–2024 | Schedules on 4/5/2025–10/9/2026 |
Additional LTI points:
- Over 90% of NEO target direct compensation in 2024 delivered as PSUs (performance equity) and annual incentives .
- No stock options were granted to NEOs in 2024 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 2,420,135 Class A (1.1%) and 24,095,071 Class B (100% of Class B) for Steinberg; 53.7% of total voting power . |
| Ownership Vehicles | Includes ACI Investment Partners LLC holdings and other affiliated entities/trusts; spouse holdings and voting agreements disclosed in footnotes . |
| Vested vs Unvested (select view) | Substantial unvested/earned PSUs and restricted shares across 2021–2024 grants; market value references as of 12/31/2024 at $17.99 per share detailed in tables . |
| Anti-Hedging/Pledging | Hedging prohibited; pledging prohibited absent pre-approval; no exceptions approved to date . |
| Insider Trading Policy | Policy in place; attached as exhibit to 2024 Annual Report . |
Implication: Majority voting control concentrates governance power and aligns incentives with equity value; significant PSU schedules create predictable vesting events into 2025–2028 that can inform supply dynamics if shares are sold upon vesting .
Employment Terms
| Provision | CEO (David Steinberg) |
|---|---|
| Severance (No CIC) | 12 months of base salary + target bonus, pro-rated target bonus, 12 months COBRA subsidy; full vesting of time-based equity; PSUs vest to extent performance conditions achieved within 12 months post-termination . |
| Severance (CIC + Qualifying Termination within 24 months) | 2× base salary + target bonus (lump sum), pro-rated target bonus, 18 months COBRA subsidy; full vesting of time-based equity; PSUs vest to extent performance conditions achieved within 12 months post-termination . |
| Equity on Change in Control (single trigger) | Any equity awards vest in full upon a change in control; PSUs vest: earned-but-unvested fully vest; unearned vest at target based on deal price deemed VWAP . |
| Restrictive Covenants | 12-month non-solicitation; confidentiality/IP; special provision allowing pre-IPO awards to continue vesting if terminated for cause and non-solicit is extended to the fifth anniversary of IPO . |
| Estimated Payouts (as of 12/31/2024) | Termination without cause (no CIC): $2.25m cash; $38,147 COBRA; $228.67m equity acceleration (marking at $17.99); CIC only: $228.67m equity acceleration; CIC + termination: $3.75m cash; $57,221 COBRA; $228.67m equity acceleration . |
Board Governance
- Board service history: Director since 2007; currently Chair and CEO (Class III; term expires 2027) .
- Dual-role implications: Board combines Chair and CEO roles; Board cites mitigants including a Lead Independent Director (Robert Niehaus) and regular executive sessions of non-management and independent directors . All directors attended at least 75% of meetings; 7 Board meetings in 2024 .
- Committee roles: Steinberg does not serve on Audit, Compensation, or Nominating/Governance committees; committees are fully independent and chaired by independent directors .
- Voting structure: As of the record date, Class B represented 53.2% of voting power; Steinberg beneficially holds 53.7% of total voting power, indicating majority control .
- Say-on-Pay: Majority support in 2024; compensation program maintained with emphasis on performance equity .
Compensation Structure Analysis
- Pay mix skew: Heavy emphasis on at-risk pay (PSUs + annual incentives >90% of target direct comp), aligning pay with stock price and growth metrics .
- Metric design: Annual bonus tied to revenue and Adjusted EBITDA; paid at target in 2024; supplemental Follow-On offering bonus reflects transactional execution .
- Equity design: Transitioned away from options (none granted in 2024); PSUs tied to stock-price VWAP with multi-year determination windows and back-loaded vesting, enhancing retention .
- Governance red flags: Club membership tax gross-up ($15,451) within perquisites; single-trigger equity vesting on change-in-control for CEO may be shareholder-unfriendly vs double-trigger norms for equity .
Performance & Track Record
| Measure | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| Value of $100 Investment (TSR) | $94.71 | $91.90 | $99.21 | $202.36 |
| Net Income/(Loss) ($000s) | (249,563) | (279,239) | (187,481) | (69,771) |
| Adjusted EBITDA ($000s) | 63,255 | 92,180 | 129,393 | 193,022 |
| 2024 Revenue ($mm) | — | — | — | 1,005.8 (up 38% YoY; +$277.0m) |
Additional 2024 operating details: scaled customer count +17% YoY; super-scaled +13% YoY; scaled ARPU +19% to $1.9m; operating cash flow $133.9m .
Equity Ownership & Alignment (Detail)
| Holder | Class A Shares | Class B Shares | % Total Voting Power |
|---|---|---|---|
| David A. Steinberg (and affiliates) | 2,420,135 (incl. restricted/earned RSUs) | 24,095,071 (all of Class B) | 53.7% |
Ownership policy risk controls: Anti-hedging and anti-pledging in effect; no pledging exceptions to date .
Employment Terms (Additional)
- Clawback: Mandatory recovery of erroneously received incentive-based compensation for 3 years preceding a required restatement (NYSE Rule 10D-1) .
- Non-solicit: 12 months; IP/confidentiality standard; special continued vesting mechanics for certain pre-IPO awards under specified conditions .
- Change-in-control equity: PSUs vest at target (unearned) at deal close based on implied price; earned-but-unvested accelerate at close .
Investment Implications
- Alignment and control: Steinberg’s majority voting control (53.7%) tightly aligns incentives with long-term equity value but concentrates governance power; mitigants include an active Lead Independent Director and independent committees .
- Incentive levers near-term: PSU VWAP thresholds ($12.875/$17.00/$22.66) and quarterly determination cadence create visible “gates” that may influence management’s emphasis on sustaining stock performance around key windows; vesting schedules into 2025–2028 imply recurring supply events if shares are sold upon vest .
- Retention risk: Multi-year, back-weighted PSU vesting, plus substantial potential equity acceleration in CIC and severance protections, reduce near-term departure risk for the CEO; however, single-trigger equity vesting in a CIC may draw governance scrutiny .
- Pay-for-performance: 2024 bonuses tied to revenue and Adjusted EBITDA at target payout, with PSUs dominating equity; strong 2024 operating and stock performance supports the pay design, though the presence of a tax gross-up for club dues is a governance blemish .
- Board governance: Combined Chair/CEO structure is offset by independent oversight practices and executive sessions; attendance and committee independence meet best-practice baselines .