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10-Year Exercise Periods Make Sense

dangelo.quora.com

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Re: 10-Year Exercise Periods Make Sense

#121

Post by genericpseudo »

hkmurakami wrote: post #95
morgante wrote: post #85

Scott's post genuinely makes me angry. It uses subtle language to imply that employees are inferior individuals who are lucky that the owners of capital deign to share anything with them. In Scott's worldview, choosing to leave a company before it has exited is inherently disloyal. Even if they're paying you under market. Even if you could contribute more value elsewhere. I wonder if he would accept similar terms: 1.…

FYI, you should be wary about any A16Z company then. This sentiment is nearly identical to what Ben Horowitz talks about here: http://www.bhorowitz.com/one_management_concept_from_how_to_... And Ben Horowitz has publicly supported Scott Kupor's blog post on Twitter. Given that he and Marc Andreesen run the show there, we can reasonably extrapolate that this is the firm's preferred stance. In fact, if either of them w…

And I will vote with my feet, as I'm sure a number of other potential employees will.

(Much as I will never knowingly work for a Kleiner company.)

Re: 10-Year Exercise Periods Make Sense

#122

Post by zzleeper »

morgante wrote: post #85

Scott's post genuinely makes me angry. It uses subtle language to imply that employees are inferior individuals who are lucky that the owners of capital deign to share anything with them. In Scott's worldview, choosing to leave a company before it has exited is inherently disloyal. Even if they're paying you under market. Even if you could contribute more value elsewhere. I wonder if he would accept similar terms: 1.…

10 years is the life of a VC fund, because that's the largest horizon that a wealthy investor is willing to part with his money even if it's not a large fraction of his wealth.

To ask almost the same (6-8 yr vesting period) to a worker that has a large fraction of his net worth in the startup seems utterly insane.

Re: 10-Year Exercise Periods Make Sense

#123

Post by genericpseudo »

The answer is clear – not easy, but clear; refuse to work with people who act in ways you find unethical.

If Scott Kupor's position is a company's position, and the total package value (including salary, benefits, etc), isn't acceptable to you when valuing options at zero – and given you don't control the company, and they can fire you at any time, you have to – then they're on the list. Refuse to work with them and tell your friends.

If you disapprove of his or A16Z's attitude, just don't accept investment from him. Let the market tell them they're wrong.

Re: 10-Year Exercise Periods Make Sense

#124

Post by phamilton »

genericpseudo wrote: post #121
hkmurakami wrote: post #95

Earlier quoted context omitted.

FYI, you should be wary about any A16Z company then. This sentiment is nearly identical to what Ben Horowitz talks about here: http://www.bhorowitz.com/one_management_concept_from_how_to_... And Ben Horowitz has publicly supported Scott Kupor's blog post on Twitter. Given that he and Marc Andreesen run the show there, we can reasonably extrapolate that this is the firm's preferred stance. In fact, if either of them w…

And I will vote with my feet, as I'm sure a number of other potential employees will. (Much as I will never knowingly work for a Kleiner company.)

What's the Kleiner rub?

Re: 10-Year Exercise Periods Make Sense

#125

Post by hkmurakami »

phamilton wrote: post #124
genericpseudo wrote: post #121

Earlier quoted context omitted.

And I will vote with my feet, as I'm sure a number of other potential employees will. (Much as I will never knowingly work for a Kleiner company.)

What's the Kleiner rub?

Might be the whole Ellen Pao harassment suit.

The firm had a big shakeup and departure of staff preceding that as well.

https://pando.com/2013/12/11/john-doerrs-last-stand-can-a-dr...

(I feel like KPCB had another harassment suit before Pao but I can't seem to recall the details.)

Re: 10-Year Exercise Periods Make Sense

#126

Post by dtemp »

tedmiston wrote: post #31
devit wrote: post #13

Isn't any vesting for non-founding employees completely broken? If the employee loses the stock when he's fired early, then the company has a huge incentive in firing him a day before he vests, and thus he should regard the vesting compensation as nonexistent. If the employee retains the stock when he's fired early, then he can just get himself fired to ignore the vesting period, making the vesting pointless. It seem…

> If the employee loses the stock when he's fired early, then the company has a huge incentive in firing him a day before he vests Not if they want to keep a reputation in the community of good developers, where demand far exceeds supply.

Short of something "going viral", I feel like it's likely an individual ex-employee's negative experience with a company won't become widely known.

Re: 10-Year Exercise Periods Make Sense

#127

Post by argonaut »

wpietri wrote: post #117
argonaut wrote: post #72

Earlier quoted context omitted.

If a contract is opaque to you, you get a lawyer to look it over. End of story. If you sign a contract that is opaque to you, without talking to a lawyer or at least someone knowledgeable (e.g. personal friends that are senior engineers that have talked to lawyers), you only have yourself to blame, not Silicon Valley. It goes without saying that I've rarely found the contracts I've signed to be opaque.

I find this sort of burden-shifting abhorrent. It's the company who will spend thousand or tens of thousands of dollars having the contract made. It's the company who gets to amortize the costs of a complicated contract over many hiring interactions. It's the company who has the advantage of a strong information and experience asymmetry. In short, the company has a lot more power. If somebody with power screws somebo…

Sure. But none of your perfectly valid comment changes the fact that if you are clueless about a contract, you should either talk to a lawyer (or otherwise someone knowledgeable) or decline to sign it.

It goes without saying that employment contracts all use the same language, I have never personally run into a clause I found opaque or confusing.

Re: 10-Year Exercise Periods Make Sense

#129

Post by ak2196 »

Quora was definitely not the first startup to do 10 year exercise period, not by some margin. My Lime Wire stock options from 2000 had a 10 year exercise with a 6 year vesting schedule, no cliff and vesting every 3 months. Here's the proof: http://imgur.com/6eTUyui

Adam's on the right track though. I just had to write a 6 figure check today to exercise my vested options at my current employer because of the 90 day clause. It makes me angry because the company's official stance is that the board wants to use stock options as an employee retention tool. I was fortunate enough to have had the cash but a lot of other people are not and there is no secondary market. So if you get fired or have to quit during a bad market you are basically screwed.

Re: 10-Year Exercise Periods Make Sense

#130

Post by rmc »

devit wrote: post #13

Isn't any vesting for non-founding employees completely broken? If the employee loses the stock when he's fired early, then the company has a huge incentive in firing him a day before he vests, and thus he should regard the vesting compensation as nonexistent. If the employee retains the stock when he's fired early, then he can just get himself fired to ignore the vesting period, making the vesting pointless. It seem…

In places with actual employment law (like the EU), you can't just fire someone with no reason.
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