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Why I will not exercise my GitLab stock options

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Re: Why I will not exercise my GitLab stock options

#91

Post by GiorgioG »

barce wrote: post #42
danaliv wrote: post #36

Being publicly critical of a former employer like this, unless you're talking about major ethical issues, seems like a bad move. There's just no way to do it without it coming across as sour grapes. If you have constructive criticism because you believe in a company and want them to do better, give it directly to the people involved. Otherwise I just have to wonder what the real motive is behind making a public state…

Yet, at the same time I would think twice before working at gitlab now. I feel the CEO or HR should have had an NDA in place with a generous severance. Also, I would be hesitant about hiring the engineer. He was given a great challenge, but instead of rising to it, he made up excuses about needing mentorship. At the very least, he could've generalized the problem, and made an open source library as leverage for findi…

> He was given a great challenge, but instead of rising to it, he made excuses...

It sounds like he worked his butt off, what more do you expect? I don't scale mountains for my employer, I do what is reasonably asked of me - and it sounds like he did just that. Sounds like a typical chaotic startup culture growing too fast for its own good, not paying attention or supporting its employees' needs.

Re: Why I will not exercise my GitLab stock options

#92

Post by a_t48 »

chrdlu wrote: post #60
sh_throwaway wrote: post #30

I feel for this guy. I was an extremely early employee at a startup, and when I left I was faced with the decision of whether or not to buy exercise my stock options. Eventually I declined to exercise them. Telling your friends that you don't value the thing you've all been pouring your life into is tough. It feels like you're insulting them. Esp when there's still money in the bank and the investors don't know what…

As elastic_church mentioned below, the firm I work for (The Employee Stock Option Fund: https://employeestockoptions.com ) could help fund the exercise and help cover potential taxes. We aim to give employees upside in the startup without them having to invest their own money.

What is your firm's angle in this? Do you take a cut of sales if\when the stock sells? I've some options that I have to act on within a month or two, but I don't think they qualify (company is kind of in the twilight zone - founded >10 years ago, but not publically traded).

Re: Why I will not exercise my GitLab stock options

#93

Post by vladimirralev »

calcsam wrote: post #26

The GitLab exec team is probably pretty happy to be reading this blog post. Because Patricio isn't exercising his stock options they will return to the option pool, where they are available for re-allocation to new hires. 0.1% of a Series B company is the entire four-year grant for a new engineer, or several sales / operations folks.

I doubt it. The guy got screwed over big time and he doesn't even fully realize it. Apparently he was working against himself for more than a year. They delayed the grant and the vesting date. Perhaps even gave him strike price with his own projected value calculated in the strike price. The whole point of the stock options is to get a strike price without your own value in there. Also it's likely there was dilution so the numbers don't add up like people say, hard to hire 150 people and take 20M without dilution. If that's the case you need 10 lawyers to watch your back working with gitlab.

Re: Why I will not exercise my GitLab stock options

#94

Post by iamdeedubs »

safanycom wrote: post #3

Glad I read this before we plunged into EE. It will please the Trello lovers.

If this taints your decision to purchase software you may want to reevaluate how you procure software.

We have been evaluating several tools and the vision Gitlab is demonstrating with their idea to production is near perfectly aligned.

Once https://gitlab.com/gitlab-org/gitlab-ce/merge_requests/10109 lands it'll be an amazing place to host projects and specifically monorepos that produce multiple containers.

Re: Why I will not exercise my GitLab stock options

#95

Post by EpicEng »

cortesoft wrote: post #48
habitue wrote: post #8

Earlier quoted context omitted.

Usually companies have a clause where they have the first right to buy the stock options back before you offer them for sale to anyone else. Employee stock options are sort of intended to be NODROP, and if they want to make shares available on like second market, they need to create a pool of shares specifically for that.

I would be curious about the legality of working around that restriction - like, what if the option holder creates a contract with someone who wants to buy the options, where they agree to hold onto them and then give them to the buyer once they are allowed to in return for a lump sum payment up front. Or, perhaps, they set up an agreement where they are given a lump sum payment up front, and agree to pay the buyer a…

I've looked into exactly this arrangement before. I couldn't find anything definitive, but I imagine that the second buyer will be in a very risky situation should the shareholder decide to break the contract down the road.

Re: Why I will not exercise my GitLab stock options

#96

Post by e40 »

mattbee wrote: post #44
danaliv wrote: post #36

Being publicly critical of a former employer like this, unless you're talking about major ethical issues, seems like a bad move. There's just no way to do it without it coming across as sour grapes. If you have constructive criticism because you believe in a company and want them to do better, give it directly to the people involved. Otherwise I just have to wonder what the real motive is behind making a public state…

On the flip-side, never let one of your staff leave your company so unhappy they write a hit-piece. As a CEO you'll know if your company has been a less-than-great manager to a member of staff. (If don't have lots of written evidence that you've been managing them well ... you've probably been managing them badly.) This guy is pained he wasn't able to contribute as Gitlab grew. You can't always bring someone round as…

On the flip-side, never let one of your staff leave your company so unhappy they write a hit-piece.

In a world where everyone is reasonable, that's good advice. There are some people you can't reason with. What I'd look for here, if I were working at Gitlab (I'm not): is there a pattern? If not, then don't worry about it. If there is, then worry.

I've seen bad exits that were the fault of the company, and ones that weren't.

Re: Why I will not exercise my GitLab stock options

#97

Post by icedchai »

calcsam wrote: post #26

The GitLab exec team is probably pretty happy to be reading this blog post. Because Patricio isn't exercising his stock options they will return to the option pool, where they are available for re-allocation to new hires. 0.1% of a Series B company is the entire four-year grant for a new engineer, or several sales / operations folks.

Is that really the average grant for a post series B company? It seems pitifully low.

Re: Why I will not exercise my GitLab stock options

#98

Post by majormajor »

owenversteeg wrote: post #52
hkmurakami wrote: post #47

Earlier quoted context omitted.

A $20MM raise suggests a $100M valuation or so. That's a 20x increase in the stock price. OP's outlay would be something like $4000 + $35000 (state tax + short term capital gains. Less depending on how he hits AMT.). I don't think that's trivial, even if I'm off by a factor of 2.

Don't some banks let you take out a loan for the amount of the capital gains taxes using the shares as collateral? I'm not sure but I could've sworn I heard about this.

If you never get a chance to sell that stock at a high enough price to cover that 35K loan, are you still personally liable for it?

Re: Why I will not exercise my GitLab stock options

#99

Post by johnmarcus »

Back in 2003, after i had given my two weeks notice but had not left yet, I posted on Yahoo finance that i thought the company i worked for "underpaid employees". That was it. And who is reading Yahoo finance anyway? I was asked to leave prior to the two weeks ending, and at least one person at where i was being hired had read it. I deleted it, pronto, and nothing bad happened to me, but it was definitely a learning experience. people that know you read the most obscure corners of the internet, and it should never be taken for granted. i suspect this person will have a hard time finding employment.

Re: Why I will not exercise my GitLab stock options

#100

Post by RamshackleJ »

AvenueIngres wrote: post #84
mixologic wrote: post #9

I didnt really see anything here of any real substance, other than OP strangely thinks that twitter is private, and that the CEO rightly advised him to link to their own product instead of their competitors. I cant really see how thats a "run in" with the CEO. All the other cultural issues he seems to bemoaning are all consequences of growth in a startup. Information flow gets harder with more people. As far as the C…

CEO stalking employees, nothing to see here... When did this become ok?

It became ok when emotionally frail tech CEO's needed to cope with nagging existential fears of _not_ actually making the world a better place, while at the same time frantically trying to succeed so that they won't be left with the horrific ignominy of not being successful _and_ making the world worse.
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