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Citing revenue declines, Airbnb cuts 25% of workforce

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Re: Citing revenue declines, Airbnb cuts 25% of workforce

#91

Post by redshirtrob »

mason55 wrote: post #62
tinyhouse wrote: post #40

Earlier quoted context omitted.

I thought RSUs are only given by public companies. Anyway, they would be crazy not to exercise.

Hopefully they have cash to cover the exercise and the taxes! Tough choice to make right when you just lost your job. The tax bill could be tens of thousands of dollars or more.

I'd expect the options might be under water based on recent funding announcements. Probably still expensive to exercise, but I can't see how there would be a tax liability if they are under water.

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#92

Post by speedgoose »

KoftaBob wrote: post #60
speedgoose wrote: post #35

Earlier quoted context omitted.

~~Yes, because it's pretty shitty for Europe.~~ I didn't understand well, sorry.

"In many countries, the severance pay is a lump sum that increases with the employee’s tenure in the company and their wage level. In the Czech Republic, Denmark, Hungary, Italy, Lithuania, Poland, Portugal, Slovakia and Spain, employees with service of up to one year are entitled to severance pay (in most cases one month’s pay), while in Luxembourg employees have to have a minimum of five years within the organisati…

Oh right, it's before the state unemployment. Then I don't know.

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#93

Post by philwelch »

airstrike wrote: post #37
yojo wrote: post #27

Earlier quoted context omitted.

I’m surprised they were still handing out options - don’t most later stage startups switch to RSUs? I’d hate to have to decide whether to exercise today, cliff or no cliff.

Why would you not want optionality? Optionality always has carries an intrinsic positive value.

1 RSU is worth 1x the stock price. 1 option is worth the delta between the stock price and the strike price, meaning 1 RSU is always worth more than one option.

Usually you get more options than you would RSU’s to compensate for this, but there’s still a risk/reward tradeoff. I have had stock options that ended up worth $0 because they were underwater. RSU’s would have been worth $non-zero.

The fact that RSU’s retain some value when the stock price goes down is highly relevant to a company like AirBNB which is undoubtedly struggling with the current situation. Also relevant may be that AirBNB isn’t a public company yet, making their shares relatively non-liquidifiable. This can pose problems both ways: if you get RSU’s in that situation you’ve received “taxable income” in the form of a non-liquidifiable asset and if you get options, you have to choose whether to buy stock in a travel accommodations company in the middle of a pandemic that just laid off 1/4 of their workforce, hence potentially incurring a very strong risk of loss.

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#94

Post by cbhl »

ping_pong wrote: post #53

I'm shocked that 2020 revenues will come in only 50% below 2019. I don't think anyone will be travelling for the bulk of this year, especially with the looming threat of potentially getting sick in a foreign country or away from your home. It will take 5+ years for them to get back the same level of inventory/hosts/customers as they had in 2019. Many hosts will foreclose on their rented properties during 2020 or conv…

I was under the impression they were pivoting rather hard into events, to diversify their income streams?

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#95

Post by whakojacko »

airstrike wrote: post #37
yojo wrote: post #27

Earlier quoted context omitted.

I’m surprised they were still handing out options - don’t most later stage startups switch to RSUs? I’d hate to have to decide whether to exercise today, cliff or no cliff.

Why would you not want optionality? Optionality always has carries an intrinsic positive value.

You don’t have nearly as much “optionality” when you have to come up with $X00,000 within 90 days of leaving your job or forfeit your equity

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#96

Post by actuator »

lucasmullens wrote: post #86
actuator wrote: post #70

Earlier quoted context omitted.

Dropping the cliff period for new employees is pretty much useless. The equity/ESOPs new employees will be exercising will be of the last valuation price which would be already high, and after Covid-19, with the struggles of tourism industry as such the notional value would have fallen a lot. So if you exercise those significantly expensive options now, you would probably need to hold it for a long time and really be…

From some other comments it sounds like they're RSUs, not options.

Why do you need to buy the RSUs then? Don't you already get them once they vest.

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#97

Post by tempsy »

yojo wrote: post #27
keiferski wrote: post #10

Separated employees will receive 14 weeks of pay, and one more week for each year served at the company (rounding partial years up). The firm is also dropping its one-year equity cliff so that employees who are laid off with under 12 months of tenure can buy their vested options; Airbnb will also provide 12 months of health insurance through COBRA in the United States, and health care coverage through 2020 in the res…

I’m surprised they were still handing out options - don’t most later stage startups switch to RSUs? I’d hate to have to decide whether to exercise today, cliff or no cliff.

Long term employees have options. All newer US based employees should have RSUs

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#98

Post by itsmefaz »

schkkd wrote: post #44
keiferski wrote: post #10

Separated employees will receive 14 weeks of pay, and one more week for each year served at the company (rounding partial years up). The firm is also dropping its one-year equity cliff so that employees who are laid off with under 12 months of tenure can buy their vested options; Airbnb will also provide 12 months of health insurance through COBRA in the United States, and health care coverage through 2020 in the res…

That's why when a yet another aspiring startup wants to hire me, I ask for a high sign on bonus as an insurance, monthly vesting cycle, at least 200k in base pay and high severance upon termination. Never been given that, but I don't regret: looking back, all those "just 1 year till IPO" companies are underwater.

I think I'm missing something here.. but how can one negotiate severance pay for termination.

I was under the assumption that companies offered severance pay as a means to save face.. and this is not part of the offer negotiation.

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#99

Post by jameslevy »

schkkd wrote: post #44
keiferski wrote: post #10

Separated employees will receive 14 weeks of pay, and one more week for each year served at the company (rounding partial years up). The firm is also dropping its one-year equity cliff so that employees who are laid off with under 12 months of tenure can buy their vested options; Airbnb will also provide 12 months of health insurance through COBRA in the United States, and health care coverage through 2020 in the res…

That's why when a yet another aspiring startup wants to hire me, I ask for a high sign on bonus as an insurance, monthly vesting cycle, at least 200k in base pay and high severance upon termination. Never been given that, but I don't regret: looking back, all those "just 1 year till IPO" companies are underwater.

Monthly vesting without a year one cliff is not really done, AFAIK. I also don't think that there is a lot of wiggle room for negotiated severance terms. But sign on bonuses and 200k base pay could certainly be on the table.

Re: Citing revenue declines, Airbnb cuts 25% of workforce

#100

Post by julesqs »

keiferski wrote: post #10

Separated employees will receive 14 weeks of pay, and one more week for each year served at the company (rounding partial years up). The firm is also dropping its one-year equity cliff so that employees who are laid off with under 12 months of tenure can buy their vested options; Airbnb will also provide 12 months of health insurance through COBRA in the United States, and health care coverage through 2020 in the res…

it's generous by startup standards, but laid off kickstarter employees are getting an even better deal because they unionized: four months full pay for everyone, up to six months of paid (not COBRA healthcare), recall rights if the jobs open back up, release from non competes

https://twitter.com/ksr_united/status/1256382357311012871

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