PALO ALTO — Earlier this month, LinkedIn’s general counsel of six years, Erika Rottenberg, announced plans to “press pause” and step down from her position.
It’s not the first time Rottenberg has taken time to recalibrate. She came to the law after a career in special education in Alaska. And in 2002, following a decade spent at Cooley and Creative Labs, and with her 40th birthday on the horizon, she left her GC post at Creative to bike coast-to-coast for nine weeks, raising money for cancer research.
When she steps down in August, Rottenberg will join a cadre of GCs at fast-growing tech companies who have stepped away from the grind—at least for now. In July 2013, Ted Ullyot retired from Facebook after nearly five years there. In August, Alex Macgillivray left his GC perch at Twitter just before its long-awaited IPO. In November, Reggie Davis moved on from Zynga four years after becoming its first lawyer.
“Five to seven years ago, that never would have happened,” noted Judith Allen, managing partner at Major, Lindsey & Africa. “It would have seemed too risky given the economic climate.”
But a common thread among these companies is that they recently went public in highly anticipated offerings, minting millions for their executive teams. That may have given their lawyers the opportunity to pursue passions outside of the law—or at least catch their breath after an intense couple of years.
Recruiters familiar with these companies and these lawyers said this group would have been well equipped to stay on in their roles, but in other instances the period after an IPO is seen by companies as a window to swap in executives with public-company skill sets.
“They want to be able to have a GC who can now shepherd the company to this different stage of life: the teenage years,” said Julie Brush, who specializes in GC recruitment and is cofounder of Solutus Legal Search.
IN ANY OTHER PROFESSION
MLA’s Allen and partner Nicole Lipman add that for this elite group of lawyers, all with bankable reputations, there’s no appreciable downside risk to leaving the workforce for a while.
“Plus, they’ve all been in pressure cookers,” Allen said. “In any other profession, it would make perfect sense to take some time off.”
But the legal industry is not like any other profession. Lawyers are not risk takers, recruiters pointed out, an attribute for which companies pay top dollar. Moreover, adds Lipman, “the legal profession values an airtight resume that really tells a story.”
So as a general proposition, GCs in the Bay Area have tended to stay put. “A lot of them have that mentality of ‘What’s not to like?’—they’ve got a pretty good gig,” Brush said.
Take Google Chief Legal Officer David Drummond. As a corporate transactions partner at Wilson Sonsini Goodrich & Rosati, Drummond was part of Google’s earliest days, helping incorporate the company and secure and structure its initial financings. In 2002, he left firm life behind to join what was then still just a search engine, first as vice president of corporate development. He now leads Google’s teams for legal, public policy, communications, corporate development and product quality operations and serves as chairman of the company’s investment arms, Google Ventures and Google Capital. Unsurprisingly, he’s regularly named one of the best-paid lawyers in the country.
EBay Inc. general counsel Michael Jacobson’s career has followed a similar trajectory. He joined the company in 1998 from Cooley, where he had been a corporate partner, the last member of the executive team brought in to handle eBay’s forthcoming IPO. At the time, Jacobson had to persuade his wife that taking a pay cut would be worth it, he told Silicon Valley Business Journal. In 2006, the most recent year in which his compensation was listed in eBay’s proxy statement, he earned nearly $5 million.
Jacobson has said in interviews that the bottom line for him was the work has remained interesting.
That’s not always the case. Some lawyers find that they prefer to be part of a leaner team than the massive organization they’d built, or that, while delegating is both essential and relieving, it comes at a cost.
And, of course, sometimes it’s not up to the lawyer: Some companies make changes across the C-suite in transitioning to a public company.
In assessing this quartet’s caliber, though they emphasized they did not have direct knowledge of the specific dynamics, recruiters said they didn’t think these departures were anything but voluntary. Regardless of the circumstances driving a departure, companies will usually have succession plans in place for such a lynchpin position as the GC. At Zynga, Facebook and Twitter, deputies already in the legal department assumed the GC role. That’s a best-practices approach, and it also expresses confidence in the team the departing GC built, recruiters said. (LinkedIn has yet to name a successor to Rottenberg.)
THEY’LL BE BACK
Solutus’ Brush said she didn’t think the retirements would be permanent.
“It’s very hard to go from 100 miles per hour to 0 and stay there,” she said. “These are young, very bright people. They will get back in the market in some way. Maybe they won’t be a lawyer, maybe they’ll be an investor or try something different, especially if money is taken out of the equation.”
Ullyot, who retired at 45, joined Facebook from Kirkland & Ellis when the site had 100 million users but little in the way of revenue. He confronted an issue that became movie fodder, Facebook’s ownership spat with the Winklevoss twins; a patent dispute with Yahoo; and guided it through—and dealt with investor blowback over—its disappointing initial public offering. When he announced his departure in May 2013, Ullyot held restricted stock units then worth about $35 million, and he’d previously sold more than $24 million in Facebook shares.
After a decade at Yahoo, Davis came to a 2-year-old Zynga as its first attorney in 2009. Now in his early 50s, Davis guided the company through trade secrets and intellectual property battles, and also saw it through highs—such as the release of its signature game, FarmVille, and its IPO—and lows, including massive layoffs. He sold 315,000 shares for $3.8 million in a secondary offering four months after Zynga’s IPO, and at the time of his retirement, still held about 38,000 shares, though the stock price has floundered.
When Rottenberg arrived at LinkedIn in 2008, the company already had 17 million members and was taking steps to go global as its founder stepped down from his CEO position. Rottenberg, now in her early 50s, grew the legal staff to a team of 30, and in her time with the company she has been an advocate for women attorneys. She delivered LinkedIn through one of 2011′s most successful IPOs and helped establish a principled presence in places like China. The 11-year-old company now has more than 300 million members. Rottenberg’s current holdings in Class A common stock are reportedly worth some $6.8 million, and according to an aggregator of SEC Form 4 data, since LinkedIn’s IPO, Rottenberg has sold shares worth about $45 million.
Macgillivray, now in his early 40s, won respect as he helped link Twitter’s identity with its approach to legal issues, advocating for free speech on the platform and beyond, and fought back against government requests for user data. He left his post before Twitter went public, so his equity stakes and potential gains aren’t known. Macgillivray came to Twitter in 2009 after a six-year run at Google.
The four either could not be reached or did not agree to an interview for this story. But the messages announcing their departures hit similar notes.
“This was a hard decision—as Zynga has been an amazing time for me—but I felt the need to take a break and explore other opportunities in the future,” Davis wrote in an email to friends and colleagues. “Whatever opportunities lie ahead when I’m ready to jump back into the fray after some time off, I’m deeply appreciative for the LinkedIn experience,” Rottenberg wrote in a post on her LinkedIn page.
Some, such as Ullyot and Davis, also have young families to consider and spend time with. And it may be that this is partly a generational thing, that lawyers of innovative young startups have taken on some of that free-wheeling cast.
But perhaps Macgillivray, back in August, put it best: “It has been my privilege to work and fight on behalf of great companies and their users over the last decade. A privilege and a lot of work.”
Contact the reporter at firstname.lastname@example.org.