Nikesh Arora: Decoding the latest entrant to the Billionaire Club

Amassing wealth with strong stints: Indian American businessman and Chairman cum CEO of Palo Alto Networks, Nikesh Arora is the latest entrant to the billionaires club after his net worth crossed $1.5 billion.

Arora, based in California, helms the Santa Clara-based cybersecurity company he joined in 2018.

Once a Googler

Before Palo Alto, Arora was known to take the highest amount home from Google as their Chief Business Officer in 2004, even after overseeing non-engineering roles like sales, marketing and partnerships. He rose to be one of the most powerful Google executives, and the most paid in 2012 when he made $51 million (Rs 424 crores) in cash and stock combined.

Arora had also placed his bets on Netflix and LoveFilm, the former valued 9 times lesser at $3 billion back then, for Google’s acquisition. While Netflix rose to be the most coveted streaming platform valued at $27 billion today, LoveFilm was eventually acquired by Amazon in 2011.

He continued in the American search engine giant before being poached by SoftBank as their President and COO.

SoftBank’s Almost Top Boss

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He was touted to succeed Masayoshi Son, the legendary investor, and became the world’s best paid executive after he received a $135 million first-year compensation package that broke Japanese records.

During his tenure at SoftBank, Arora struck a $250-million deal for a minority stake in Legendary Entertainment, after an unsuccessful attempt at partnership with DreamWorks Animation, Reuters had reported citing sources.

He was replaced by Ken Miyauchi, head of SoftBank’s Japanese telecommunications operations as president and chief operating officer after Arora stepped down in 2016.

Right Place, Right Time?

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The 55-year-old’s latest stint gave Arora $125 million in stocks, which jumped multifold to $830 million after cybersecurity software became more relevant for businesses, especially during high-profile ransomware incidents that surged during the pandemic.

These stocks combined with pay awards in his career and over 3.4 million options awarded while joining Palo Alto, which offers a platform that includes advanced firewalls and cloud-based offerings that extend those firewalls to cover other aspects of security

Arora sold nearly $300 million worth of shares last year after exercising his options, becoming a rare non-founder billionaire tech CEO as per Bloomberg Billionaires Index.

Money Keeps Flowing

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Arora’s compensation for the last year at Palo Alto Networks includes 7.5 lakh stocks, valued at over $220 million (around Rs 1833 crore). The company justified the compensation in a proxy statement, saying Arora earned it on the back of strong performance in the past 5 years. 
If calculated, Arora pocketed $102 million (around Rs 849 crore) of value each year.

Palo Alto Networks has a market cap of more than $ 91 billion.

The Indian Touch

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Arora, during his tenure at SoftBank, was behind investments in e-commerce platform Snapdeal, cabs to EV scooters company Ola, delivery platform Grofers (now Blinkit), Housing.com and Ritesh Arora’s Oyo Rooms.

As per his LinkedIn, Arora in 1985 enrolled for his bachelors in Electrical and Electronics Engineering at Indian Institute of Technology, Banaras Hindu University in Varanasi, Uttar Pradesh.

Arora donated $2 million (Rs 16 crore) to Indian Institute of Technology (Banaras Hindu University), which contributed in 77 scholarships combined with the donation of others.

Six days ago, he posted on LinkedIn: “Dear IIT BHU Alumni and friends of IIT BHU. $6M is not a lot if everyone spared some pre-tax dollars to support students at the Institute we could cover all those in need. Remember this is a means based scholarship and the students need to be part of the creme de la creme in India to pass the JEE exam. It is important for us to support all the students who deserve a stellar engineering education. The scholarship is intentionally named the Alumni Fund to ensure we are all equal in our donor status irrespective of whatever one chooses to spare. “

Arora was born in the NCR region of Ghaziabad, son of an Indian Air Force officer. He completed his schooling at The Air Force School.

Beginnings

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Nikesh helmed the chief marketing office for T-Mobile from 2000 to 2004, as per his LinkedIn.
T-Mobile was the International Division of Deutsche Telekom AG.

He later became the chief executive officer and founder of T-Motion PLC, which merged with T-Mobile International in 2002.

He initiated his professional journey at Fidelity Investments in 1992, leaving as Vice President before he joined T-Mobile.

Besides SoftBank Group Corp, Arora has also served on the boards of Sprint Corp, Colgate-Palmolive Inc and Yahoo! Japan.

He has an MBA in Marketing from Northeastern University in Boston, United States and a Master of Science in Finance and General from Boston College.

Arora was bestowed an honorary PhD in Business, Commerce and General by his alma mater, Northeastern University.