31–40 of 77 posts
Anyway, it's nice that they've announced their intentions, but I'll believe it when it actually happens. For all we know they could pull a We and back out at the last minute.
It is ironic that no one has disrupted this market yet. Pre-IPO shares can be traded - you just have to trade those with accredited investors, prior to the form S-1 filling. I'm sure there's plenty of accredited investors out there that would accept startup shares at, say, 5-10% discount. Put another 2-3% transaction costs on top of that and you got yourself a very nice and socially pleasing enterprise.
You have to have approval from the company to perform the transfer usually.
This is the number one reason I would not want to work for a startup. Even in the unlikely event that the company is successful, there's better than even odds that you won't be able to trade on that success for years to come. That means you're effectively locked in at the company until it suits the executives to let you out. No thanks. I'd rather have a higher salary and immediately tradable equity grants with a comp…
In addition to that, the founders are signaling their own long-term lack of confidence by selling their shares when no one else is allowed to do so. Employees are correct to pressure their employers to IPO or GTFO, especially considering that many of these companies are on a trajectory where they're worth less over time (e.g. the collapsing valuations of Uber, Lyft, Slack, "We", etc).
I spent most of my 20s (7+ years) at a startup that is currently a “unicorn”, and consequently have an ok amount of shares locked up in the same situation. As the company’s valuation grew higher and higher the equity grants became significant lower. It was balanced out by my pay becoming more and more competitive vs other large companies. But eventuality I decided ~80% was as fully vested as I’ll ever be — Not to men…
"and because I joined so early my options were cheap enough to exercise over time" --> So you were exercising regularly while the company still wasn't worth much? That's a best-case scenario. The problem comes when early employees have a low strike price but don't exercise until the valuation is high, either because of vesting or just not getting around to it. Anyone with, e.g. 50 cent Airbnb options is looking at a…
Earlier quoted context omitted.
In addition to that, the founders are signaling their own long-term lack of confidence by selling their shares when no one else is allowed to do so. Employees are correct to pressure their employers to IPO or GTFO, especially considering that many of these companies are on a trajectory where they're worth less over time (e.g. the collapsing valuations of Uber, Lyft, Slack, "We", etc).
True in the case of wework yes but in the case of Airbnb the founders seem to have collectively cashed out only a few tens of million, which just sounds like they cashed out just enough to buy themselves nice cars or something
Earlier quoted context omitted.
In addition to that, the founders are signaling their own long-term lack of confidence by selling their shares when no one else is allowed to do so. Employees are correct to pressure their employers to IPO or GTFO, especially considering that many of these companies are on a trajectory where they're worth less over time (e.g. the collapsing valuations of Uber, Lyft, Slack, "We", etc).
True in the case of wework yes but in the case of Airbnb the founders seem to have collectively cashed out only a few tens of million, which just sounds like they cashed out just enough to buy themselves nice cars or something
As someone whose spent nearly 13 years in the startup world my advice is this. Expect your cash comp to be your only comp and negotiate cash comp separately from equity.
Most startups fail... and even those who do succeed? The VC's get first payout... then founders... then maybe what's left for you...
Also there many other situations a company can pull to invalidate or take equity away from employees (think Zynga).
There is alot to gain in working at startup, just dont think the equity is the main reason to.
Hard to feel sorry for anyone there since it's extremely unlikely that Airbnb is going to leave hanging anyone with expiring options (i.e. the oldest and probably most valuable employees), and those people are almost all bound to make many, many millions of dollars. Not sure what the deal is with Chesky's hesitation to going public, but Airbnb is by all accounts a wildly successful company and folks are going to "get…
I remember 5 years ago when I turned down a lucrative offer from Uber because I just didn't believe in the company. People told me I was crazy, that Uber was the future of transportation, and how could I not understand how stupid I was? I just looked the fundamentals and said it will never make money.
AirBnB and Uber are very different companies, the most notable difference being that AirBnB actually makes money. That said, AirBnB has lots of issues to be worked out before I would consider them a "wildly successful company" in the sense that they are not doing remotely as well as they should be considering how many years their competition was paying regulatory taxes and they weren't. Based on anecdotal evidence, their dark patterns are making their users grow to hate them more every day (not a great sign before an IPO) and they're making weird moves in the hotel space - that industry they were supposed to replace instead of become. And now they have real competition from HomeAway and others and I just don't see a growth trajectory for them anymore - honestly I see them shrinking in a few years. The fact that it took them until 2017 to generate a profit in a space where they own nothing, rent nothing, and have no expensive infrastructure in an enormous market where they didn't pay competitive taxes (but managed to win a local election despite this clusterfuck https://slate.com/business/2015/11/airbnb-defeats-prop-f-in-...) is a fucking alarm bell. More cities across the world are starting to ban their service, and laws are being created to actually enforce this. I am certain if this comment gets seen by many people I will get replies telling me why AirBnB is healthy, and all is well, and I just don't understand - just like I did all those years ago with Uber.
I'm not convinced AirBnB is going to exist in 10 years (for many more reasons than I listed in the paragraph above). Maybe I'm wrong. But until AirBnB is a public company for ~6 months and we can see their financials, watch the stock price fluctuate, and see how many people jump ship the moment their equity vests...well it's just another unicorn story where the VCs are pumping up the price to dump the stock.