In a bold move that underscores the high-stakes world of real estate technology, Opendoor Technologies Inc. has tied its new chief executive’s fortunes directly to the revival of its beleaguered stock price. Kaz Nejatian, formerly the chief operating officer at Shopify Inc., steps into the role with a compensation package that eschews traditional salary structures in favor of performance-based incentives, signaling a desperate bid to turn around the company’s fortunes after years of market turbulence.

Nejatian’s deal, detailed in a recent securities filing, includes a symbolic $1 annual base salary, supplemented by restricted stock units potentially worth billions if he can drive Opendoor’s shares to unprecedented heights. This structure reflects a growing trend among tech firms to align executive pay with shareholder value, but it places immense pressure on Nejatian to deliver amid a volatile housing market still recovering from post-pandemic highs.

Leadership Overhaul Amid Investor Pressure

The appointment follows the abrupt resignation of previous CEO Carrie Wheeler in August, prompted by intense scrutiny from activist investors and online critics who lambasted her stewardship as Opendoor’s stock plummeted more than 90% from its 2021 peak. According to reporting from CNBC, Wheeler’s exit came after weeks of mounting pressure, with the company’s shares briefly surging on the news but remaining far below historical levels.

Opendoor, known for its iBuying model that allows instant home purchases and sales, has also brought back co-founders Eric Wu and Keith Rabois to the board, a move seen as a nod to the company’s innovative roots. This shakeup, coupled with a $40 million equity infusion from Khosla Ventures and Wu himself, aims to inject fresh momentum into a firm that has struggled with inventory costs and interest rate fluctuations.

Incentives Tied to Ambitious Milestones

Delving deeper into Nejatian’s package, as outlined in The Information, the executive stands to receive over 80 million restricted stock units, vesting only if Opendoor’s stock hits specific targets—ranging from $5 to $30 per share over multi-year periods. If all hurdles are cleared, Nejatian could amass equity valued at up to $2.8 billion, representing about 11.6% ownership, per analysis from Fortune.

This all-or-nothing approach draws parallels to high-profile tech turnarounds, such as Elon Musk’s compensation at Tesla Inc., where pay is contingent on market cap milestones. Industry insiders note that while such deals can motivate aggressive growth strategies, they also risk short-term decision-making that prioritizes stock performance over sustainable operations.

Market Reaction and Strategic Implications

Wall Street responded enthusiastically, with Opendoor’s shares skyrocketing more than 30% in a single trading session following the announcements, as reported by Investopedia. Analysts suggest this surge reflects optimism about Nejatian’s e-commerce expertise from Shopify, where he helped scale operations during rapid growth phases.

Yet, challenges loom large. Opendoor operates in a sector battered by rising mortgage rates and economic uncertainty, with competitors like Zillow Group Inc. also pivoting away from iBuying. Nejatian must navigate these headwinds while leveraging AI and technology innovations—areas the company highlighted in its interim leadership transition, according to Investing.com—to rebuild investor confidence.

Broader Lessons for Tech Governance

For industry observers, Opendoor’s gambit raises questions about corporate governance in the post-SPAC era. The company went public via a blank-check merger in 2020, a path that fueled initial hype but led to painful corrections. Nejatian’s incentive-heavy contract could set a precedent for other struggling tech firms, emphasizing accountability but also highlighting the perils of over-reliance on stock metrics.

As Opendoor embarks on this new chapter, success will hinge on Nejatian’s ability to blend Shopify’s operational prowess with real estate acumen. If he succeeds, it could validate the model of founder returns and performance pay; failure, however, might amplify calls for more conservative leadership strategies in an unforgiving market.