Zip co-founder Larry Diamond departs board
Zip co-founder Larry Diamond departs board with sights set on philanthropy
Larry Diamond, the executive director and US chairman of Zip Co (ASX: ZIP), will resign from the board of the buy-now pay-later powerhouse he co-founded more than a decade ago with plans to set up a family office and foundation to further his philanthropic endeavor's.
The news comes almost seven months after Diamondtook a step back from his chief executive officer rolein the US, where he relocated in 2022 to help drive growth in a market that became its largest in FY24 in terms of both revenue and cash earnings.
Zip Co made a huge bet on the US market during the height of the pandemic with the acquisition ofQuadpay, but like many BNPL operators the company later struggled with how the model would work in a higher-interest rate environment and as investors placed greater emphasis on profitability following a long period of loss-making growth in the tech sector more broadly.
ZIP shares slumped dramatically between the start of 2021 and mid-2022. Operations were simplified in response with divestments out of the UK, Central and Eastern Europe, Mexico, Singapore, and South Africa, but Zip hung on to the US with its co-founder taking a hands-on approach in the world's largest consumer market.
His efforts have paid off for the company in which he holds approximately 4.17 per cent of shares, or $186.75 million worth. Since the start of this year ZIP shares have risen more than five-fold.
"Now is the right time for me to step back from my day-to-day role at Zip," he said in a statement to the ASX today.
"I’m very proud of what Zip has achieved and have total confidence in the team that will be leading the company to continued great success. I remain a committed shareholder and supporter of Zip and the team."
Zip chair Diane Smith-Gander AO put Diamond's departure in the context of a broader maturation of founders in the tech sector.
"We respect Larry’s decision and express our appreciation of his extraordinary achievement, having co-founded Zip with Peter Gray in Australia in 2013," she said.
"We acknowledge that there is a changing of the guard across the tech sector as companies have matured and their founders are now in a position to realise their next stage of contribution to their domestic and international communities, in Larry’s case through his new Family Office and Foundation."
Zip Group CEO and managing director Cynthia Scott described Diamond as an "inspirational leader" who has made an enormous contribution to the sector.
"He has prepared the team well for this natural progression and is stepping down at a time when we have the leadership and broader team executing strongly on a strategy that is delivering for the company and its shareholders," she said.
"Joe Heck, who joined as our US CEO in July, is doing a terrific job leading the growth of the US business and driving our significant opportunity in that market.”
from a LTHs perspective it was a surprise that LD has decided to step down, however he's done the groundwork now in the US and with CS running the business as a whole I'm confident that Zip will be positively moving forward under her leadership, and it would seem the market agrees! The AFR mentioned he sold $30 million worth of shares 2 hrs ago and now its $100 million Lol
