How does equity compensation drive wealth for Indian American tech executives?

Why stock, not salary, builds tech wealth

At large US technology companies, cash pay is capped and equity is not. Proxy filings show the pattern clearly. Nadella's fiscal 2025 package included more than $84 million in stock awards and over $9.5 million in cash incentives¹. Arora's salary was $1 million, beside $94.9 million in stock awards². Alphabet keeps Sundar Pichai's salary at $2 million, unchanged since 2020, and pays him mainly in equity granted every three years³. The same structure applies, at smaller scale, to vice presidents, directors and senior engineers. Many of them hold restricted stock units worth several times their salary.

That matters for Indian American wealth because the community is concentrated in exactly these roles. 62% of H-1B petitions approved in fiscal 2025 were for computer-related occupations, and 70% were for people born in India⁹. Indian immigrants are much more likely than other groups to work in management, business and science occupations¹⁰. Our breakdown of CEO pay and analysis of H-1B visas and wealth add detail.

What HeyAlbert data shows

The main instruments

• Restricted stock units (RSUs). A promise of shares that vest over time, usually over several years. Pichai's 2026 award, for example, vests monthly through January 2029³.
• Performance stock units (PSUs). Shares that vest only if targets are met. Alphabet's PSUs for Pichai depend on total shareholder return against S&P 100 companies and can vest at 0% to 200% of target³.
• Stock options. The right to buy shares at a fixed price. The IRS distinguishes statutory options (incentive stock options and employee stock purchase plans) from nonstatutory options⁷.
• Founder equity. Shares held from a company's founding. It is the largest source of wealth for founders such as Jay Chaudhry, whose family holds around 35% of Zscaler, per Forbes¹¹.

How it is taxed

Tax treatment drives many planning decisions. Under the IRS restricted-property rules, stock received for services is generally taxed as income when it becomes substantially vested. The taxable amount is its fair market value minus anything paid for it¹². Under IRS rules, a nonstatutory option with no readily determinable market value is not taxed when granted. When it is exercised, the difference between the stock's fair market value and the price paid counts as income, and a later sale produces a capital gain or loss⁷. Statutory options are generally not included in income at grant or exercise. Exercising an incentive stock option can trigger the alternative minimum tax, though⁷. Executives with large positions often face concentrated-stock risk and large tax bills at the same time. That is why diversification, charitable giving of appreciated stock and family-office structures appear early in planning. Cross-border families have additional reporting requirements, covered in our guide to FBAR, FATCA and the US-India tax treaty.

Selling: plans, windows and timing

Senior executives cannot simply sell when they like. Many use pre-arranged trading plans under SEC Rule 10b5-1. In 2022 the SEC added cooling-off periods before trading can start under such plans, and required that plans be entered into in good faith⁸. For relationship managers and advisers, scheduled vesting dates, plan adoptions and lock-up expiries after an IPO are the moments when paper wealth turns into cash. Arora's roughly $800 million in pre-tax proceeds since 2023 came through exactly these mechanisms⁶.

Timing affects the tax bill as well as the proceeds. Under IRS rules, the gain on shares sold after exercise or vesting is generally treated as a capital gain or loss⁷. Holding periods therefore change the tax rate, and executives and their advisers often plan sales around them. The same calendar decides when a family has cash for a home, an angel investment or a major gift.

Ownership versus pay

The largest fortunes come from owning a company, not from being paid by one. Jayshree Ullal's reported 2025 pay at Arista Networks was $2.9 million⁴. Her roughly 2% stake underpins a Forbes estimate of about $6.7 billion⁵. Professional CEOs build wealth more slowly through repeated grants. Founders and very early employees can reach the top tier in a single liquidity event. Our ranking of the richest Indian Americans and our list of the largest founder exits show both routes.

What it means for household wealth

Equity-heavy pay makes tech households wealthier on paper and more exposed to a single stock. Many diversify into real estate, index funds and private investments over time, and some start angel investing. Our research on how Indian Americans invest, on angel investing through networks such as TiE and on family offices follows that money.