Automattic’s Interim CEO and Legal Chief Signed Reciprocal Severance Deals

While Matt Mullenweg, CEO of Automattic, took a brief leave of absence, two of his most powerful executives signed reciprocal severance agreements that guarantee them a year of salary and additional equity vesting if their departures qualify. The news, first reported by TechCrunch, exposes an unusual move in the corporate governance of a startup that controls WordPress.com and Tumblr.

Context: a temporary exit that raised eyebrows

Mullenweg, known for his intense and controversial leadership style, temporarily stepped back from his duties in late 2024 amid public disputes with WP Engine. During that power vacuum, CFO Mark Davies and legal chief Andy Missan made key decisions without the founder's direct oversight. The question now is whether these agreements were legitimate protection or a move to shield themselves from a potentially confrontational return.

Details: what exactly did they sign?

According to leaked information, Mark Davies and Andy Missan each signed the other's severance agreement, a mechanism that prevents one person from approving their own exit package. The terms include:

• A full year of base salary as severance compensation.
• Accelerated vesting of additional stock options.
• Conditions that only trigger if their departure is considered "qualified" (termination without cause or resignation for good reason).

What's striking is that these deals were signed while Mullenweg was on leave, raising questions about whether the interim CEO and legal chief acted within their authority or took advantage of the absence to secure a golden parachute.

Analysis: who wins and who loses?

It's clear that Davies and Missan protected themselves against an uncertain scenario. If Mullenweg returns with a score to settle or if the company faces restructuring, they already have their exit secured. The loser, in theory, is Automattic: the company could be forced to pay millions if both executives decide to leave. And for Mullenweg, it's a reminder that his absolute control isn't so absolute when he's not watching.

Implications: what's next for Automattic?

This episode shines a light on governance in unicorn startups, where founders often wield disproportionate power. The board of directors will likely review these agreements and Mullenweg may take steps to prevent a repeat. Industry-wide, it's a wake-up call: investors will want to know if leadership teams are making unilateral decisions during CEO absences.

In the end, the question isn't whether Davies and Missan acted properly, but how many other executives in Silicon Valley are doing the same while no one is looking.

Source: TechCrunch