Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
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Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#2Boy this article is a very friendly interpretation of Scott Kupor's blog post.
From NYTimes:
> He [Scott Kupor] also suggests a longer period for employees to exercise options after they leave, up to 10 years. That figure is endorsed by Y Combinator in an argument that any lesser period is unfair to employees.
Makes it seem like Scott Kupor is on the leading edge of caring about employees, in agreement with YC (which has actually been employee friendly in words and actions in regard to stock options).
However, read Scott's actual blog post and he refers to the 10 year exercise idea incredulously:
> The 10-year “solution” thus takes money/option value out of the pockets of the current (and growing) employee base to line the pockets of former employees who are no longer contributing to the business.
> Talk about disenfranchising your remaining employees and not being able to attract new ones.
Good reminder to always read your primary sources.
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#3Wouldnt it be nice to have coworkers (ish, they both have positions at Berkeley) who can write willfully ignorant reinterpretations of your terrible ideas in the Times?
Edit: I don't know for a fact that they are coworkers in a meaningful sense, of course a university is a large place, but I would expect a professor of law to have better reading comprehension than was on display here.
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#4> It also makes them agree to a nondisclosure arrangement that forbids them from even talking about the repurchase and waive any claims they might have against the company. And the offer extends to some but not all former employees.
That smells funny and oddly specific.
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#5Does anybody think that this puts them closer to an IPO?
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#6Boy this article is a very friendly interpretation of Scott Kupor's blog post. From NYTimes: > He [Scott Kupor] also suggests a longer period for employees to exercise options after they leave, up to 10 years. That figure is endorsed by Y Combinator in an argument that any lesser period is unfair to employees. Makes it seem like Scott Kupor is on the leading edge of caring about employees, in agreement with YC (which…
Indeed it is. I particularly like the 'no longer contributing to the business' part, as if the work done by the original employees isn't what the current business was built on, at a discounted rate if their stock options are worthless. And as if the stock options were the only reason they're having trouble attracting quality talent.
Stock options seem attractive as a form of compensation, since the hope is that you're working for a unicorn and one day you'll be fabulously rich, but the cash equivalent is better more often than not. It's just a form of risk transfer from those who have plenty to those who hope to have plenty by dint of talent and hard work. Having been burnt, I won't do it again.
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#7I can't find the source so this is from memory; but Karp or Theil said they wouldn't ever go public and essentially can't because they are essentially a DoD contractor. While other companies notably do similar things and other contractors are public, Palantir provides a unique platform to some extent and their customer base, much of their technology and operations are secret.
It is known they will not likely go public as it would be detrimental to their business and in-Q-tel (cia vc arm) is a major shareholder. While Silicon Valley does need to rethink some of the ways they compensate employees; especially at late stage private ones, I would not consider Palantir indiicative of a typical SV unicorn
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#8Palantir's official reason of "improving employee moral" doesn't seem to really mesh with the conditions they are imposing on the buy-back:
> [...] employees who sell their shares agree agree that they will not compete with Palantir for 12 months or solicit any Palantir employees during that time [...] [and] agree to a nondisclosure arrangement that forbids them from even talking about the repurchase and waive any claims they might have against the company.
The nyt put forwards a reasonable idea that this is a mechanism to increase their perceived value, and I'm inclined to agree.
EDIT: the buzzfeed article [1] paints an even worse picture:
> If they [employees] get any inquiries about Palantir from reporters, the contract says, they must immediately notify Palantir and then email the company a copy of the inquiry within three business days.
[1]: https://www.buzzfeed.com/williamalden/palantir-seeks-to-muzz...
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#9This sounds like a company in big trouble and trying desperately to stem attrition and improve tanking morale.
According to crunchbase they're basically owned by a private equity firm now (which is rarely a fun place to be) and are raising something like a billion dollars a year -- which basically appears to be around what their operating costs are (employee count of that year * $250k/yr).
They're either not bringing in any real revenue, or growing at the rate of revenue. Multiple raises per year (of weirdly different values) indicate frequent requests for more money.
Are they growing or are they dying? Either way they aren't doing it through revenue, and they're not going public so the financials stay very hidden.
Re: Palantir Buyback Plan Shows Need for New Silicon Valley Pay System
#10I can't find the source so this is from memory; but Karp or Theil said they wouldn't ever go public and essentially can't because they are essentially a DoD contractor. While other companies notably do similar things and other contractors are public, Palantir provides a unique platform to some extent and their customer base, much of their technology and operations are secret. It is known they will not likely go publi…
All is not friendly in the shire, remember this post from a few years ago?