51–60 of 190 posts
Earlier quoted context omitted.
> This is the case for pretty much every privately-held company in the valley Many companies allow employees and ex-employees to sell shares.
Being able to sell shares would imply it's a public company, not a private one, right?
Earlier quoted context omitted.
> This is the case for pretty much every privately-held company in the valley Many companies allow employees and ex-employees to sell shares.
Being able to sell shares would imply it's a public company, not a private one, right?
"Public" means your shares are registered [1]. "Private" usually means shares offered under Rule 506 of Reg D [2]. Public and private shares can be bought and sold. The processes, and their respective ease and restrictions, vary.
Palantir [3] and Airbnb [4], for example, recently bought back their employees' shares.
[1] https://www.sec.gov/fast-answers/answersregis33htm.html
[2] https://www.sec.gov/fast-answers/answers-rule506htm.html
[3] https://www.nytimes.com/2016/06/29/business/dealbook/palanti...
[4] https://www.nytimes.com/2016/08/12/technology/airbnb-and-oth...
Disclaimer: I am not a lawyer. This is neither legal nor investment advice.
Earlier quoted context omitted.
Another detail that's not well-known unless you know someone who's gone through it: buying your shares comes with a huge tax bill. As I understand it, you have to pay tax on the difference between the option price and the value at the time you buy them. So if you have a bunch of options to buy at $10 per share, and the company grows to $90 per share by the time you quit/have to buy your shares, you're taxed on $80 a…
I dont understand this. if they're worthless & you can't sell, why do you pay tax as if the stock is worth $90? Edit: Can someone point me to IRS docs? or blog explaining?
Earlier quoted context omitted.
Another detail that's not well-known unless you know someone who's gone through it: buying your shares comes with a huge tax bill. As I understand it, you have to pay tax on the difference between the option price and the value at the time you buy them. So if you have a bunch of options to buy at $10 per share, and the company grows to $90 per share by the time you quit/have to buy your shares, you're taxed on $80 a…
This is if you hit AMT, if you have ISOs. One positive for startup employees of the GOP tax bill is that it seeks to repeal AMT for individuals. If you have NQOs, this tax always happens.
Yet another reason why taking startup stock sucks. Oh? You managed to actually get stock in a startup that seems to be worth something? And you didn't get diluted to a pittance? And the board / founders didn't try to fire you or ask you to give stock back to the pool? Lucky you, you're one of the 1% of the 1%. Now stay there until the company sells or goes public. Wait -- they got bought? Congratulations, you just wo…
Another detail that's not well-known unless you know someone who's gone through it: buying your shares comes with a huge tax bill. As I understand it, you have to pay tax on the difference between the option price and the value at the time you buy them. So if you have a bunch of options to buy at $10 per share, and the company grows to $90 per share by the time you quit/have to buy your shares, you're taxed on $80 a…
https://www.collinsbarrow.com/en/cbn/publications/taxation-o...
Earlier quoted context omitted.
Another detail that's not well-known unless you know someone who's gone through it: buying your shares comes with a huge tax bill. As I understand it, you have to pay tax on the difference between the option price and the value at the time you buy them. So if you have a bunch of options to buy at $10 per share, and the company grows to $90 per share by the time you quit/have to buy your shares, you're taxed on $80 a…
I dont understand this. if they're worthless & you can't sell, why do you pay tax as if the stock is worth $90? Edit: Can someone point me to IRS docs? or blog explaining?
Uber is specifically and wilfully shitty when it comes to employees’ stock. Large investors have always been able to sell, in part because they hold their shares in LLCs. Smaller investors, however, get blocked. When the price started crashing, the big guys got out. The little guys remain locked inside. Something similar happened at Palantir. When a big little guy sued, things changed [1]. [1] https://www.bloomberg.c…
Uber isn't publicly traded, so its stock price couldn't have "started crashing." Large investors aren't able to sell because they hold their shares in LLCs. They're able to sell because selling rights are part of the terms they negotiated as part of their agreement to invest. The form of ownership has nothing to do with it, and indeed the use of an LLC as a holding company for corporate stock usually complicates the…
Yet another reason why taking startup stock sucks. Oh? You managed to actually get stock in a startup that seems to be worth something? And you didn't get diluted to a pittance? And the board / founders didn't try to fire you or ask you to give stock back to the pool? Lucky you, you're one of the 1% of the 1%. Now stay there until the company sells or goes public. Wait -- they got bought? Congratulations, you just wo…
libertarians will tell you that that's on you for not understanding the risks involved, but that's a heartlessness and antisocial position to take. instead, potential startup employees can educate themselves a bit on how options are a risky derivative investment in the startup you work for. there's really no need for the bitterness in your post once you can properly account for them (they're like lottery tickets that…
You're missing the constant drumbeat of "options will make you rich! Work 80 hour weeks, sacrifice your health and relationships, get paid well below market rate, join our startup!"
The entire VC industry is focussed on misleading people like this. One of the reasons for ageism in Silly Valley is that experienced engineers can't be suckered like this.
Earlier quoted context omitted.
Another detail that's not well-known unless you know someone who's gone through it: buying your shares comes with a huge tax bill. As I understand it, you have to pay tax on the difference between the option price and the value at the time you buy them. So if you have a bunch of options to buy at $10 per share, and the company grows to $90 per share by the time you quit/have to buy your shares, you're taxed on $80 a…
This is if you hit AMT, if you have ISOs. One positive for startup employees of the GOP tax bill is that it seeks to repeal AMT for individuals. If you have NQOs, this tax always happens.
Have seen this far too often. I was at a successful UK based startup very early on, so my strike price was pennies. Those who joined a year or two later were looking at strike prices in excess of £30 with hundreds shares. Recent investment rounds put the share price at around £120, but as always current employees can't sell until a full sale or IPO. The result? A swell of employees who want to leave/move on but can't…
Not "deferred compensation"?