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Bolt Financial's loans come due

axios.com

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Re: Bolt Financial's loans come due

#91

Post by bpodgursky »

subsubzero wrote: post #88

Boy do I hate how ISO options are treated by the IRS for startup employees. It puts an insane amount of risk on the employee in both coming up with the cash to exercise(bolt offered loans for this part) and then the worst part, being taxed on unrealized gains. The latter to me seems completely against how the rest of the tax code when it comes to stock based assets. And it leaves employees who are not well informed o…

- If you join as an early employee, your strike price is minimal and this isn't a concern at all

- If you want to minimize risk in return for higher taxes (call ~40%), just hold your ISOs and exercise-and-sell as a same-day sale when you're liquid (ie forgo the tax advantages of ISOs). There's absolutely no way for you to get screwed over if you're willing to take the gain as standard income.

Re: Bolt Financial's loans come due

#92

Post by w0de0 »

This isn’t a competent news article. I’m not commenting on Bolt Financial’s unethical choices, but simply on the poor, slightly insulting Axios style and format.

Particularly egregious is the line which begins “Yes, it's welcome news…” You are ostensibly the news, Axios - why are you telling me how to feel about yourself? Axios repeats this pattern frequently - their signature bulleted snippets of supposed fact often being little more than tweets.

Also they carry obsequiously friendly reporting on Amazon frequently.

Re: Bolt Financial's loans come due

#93

Post by icelancer »

dghlsakjg wrote: post #70
automatic6131 wrote: post #12

Earlier quoted context omitted.

I was just about to make this point. How does "one click checkout" become worth $11B? (massive) Capital misallocation, i'd imagine

Also isn’t this in somewhat direct competition with Apple Pay, Google Pay, Amazon Pay and Stripe? I would not want to bet against any one of those companies, let alone ALL of them.

Correct, and you didn't even name their toughest competitor - Shopify's one-click checkout.

Re: Bolt Financial's loans come due

#94

Post by [deleted] »

onlyrealcuzzo wrote: post #90
rangersanger wrote: post #81

Earlier quoted context omitted.

>this was just a way to pay employees with their loan This feels like a more complex, insidious version of company scrip. At the end of the day, you’re getting paid in fake company money that’s worthless if they go belly up.

It is not worthless! That's typical startup equity (common stock for employees at least). The whole point is you're in debt (against worthless equity). It's negative worth!

[deleted]

Re: Bolt Financial's loans come due

#95

Post by Apocryphon »

icelancer wrote: post #57
sydthrowaway wrote: post #10

I don't get the value of this company. How can fellow SWEs who learnt about kernels, networks and hardware (among other incredibly complicated works) get excited about ONE CLICK CHECKOUT? Maybe this is the JS boot camp effect.

>> How can fellow SWEs who learnt about kernels, networks and hardware (among other incredibly complicated works) get excited about ONE CLICK CHECKOUT? I'd be willing to bet like 80-90% of SWEs are just people who write code 9-5, have little passion for the job, and just collect paychecks like most people in America. HN and Slashdot and so forth provide a very skewed view on our profession. So when Bolt offers people…

I had a former coworker who has a doctorate in physics with an emphasis in nuclear engineering, then a masters in CS. She ended up coding Rails at a startup because it paid better. The market demands its CRUD.

Re: Bolt Financial's loans come due

#96

Post by Apocryphon »

hoofhearted wrote: post #20
madamelic wrote: post #11

Earlier quoted context omitted.

My understanding is that Bolt lined up loans for employees to cover employees' tax burdens due to exercising their options. In simpler words: Bolt helped employees take out personally guaranteed loans to give Bolt money. In the loan terms, if the employee leaves for any reason, the employee owes Bolt the entire loan amount within 90 days of end of employment.

Doesn’t all this smell ENRON’ish?

It’s less Enron and more like the financialization of everything. Companies have so much capital they start investing in other startups or try our harebrained schemes like this, rather than spending it on R&D.

Re: Bolt Financial's loans come due

#97

Post by bradj »

tempsy wrote: post #86
gkoberger wrote: post #80

Earlier quoted context omitted.

If you're working at a small tech startup, you're likely not making a huge salary. Good, sure, but not huge. It's possible you left your high-paying FAANG job to be developer #3 at a tiny little startup, but in my experience this almost never happens. Also, $10k is a lot of money. Even if you have it in savings (and I'd agree a lot of tech people technically do), it's a huge gamble on an unknown startup. You're alrea…

if that’s truly how you feel why would you accept an offer where that’s how a significant percentage of your compensation works? these types of work environments self select for people who are comfortable taking on risk. no one is forcing you or anyone else to join.

People can have a variety of different comfort levels with different kinds of risk. You’re suggesting that someone should consider a slightly lower salary + future possible earnings on options as equivalent to slightly lower salary + future possible earning on options - risk of loss on early exercise. Some people work for startups, some are angel investors, there is some overlap but it’s not 1:1 and it’s because those are different types of risk.

Re: Bolt Financial's loans come due

#98

Post by floren »

xwdv wrote: post #34

Imagine if getting fired and immediately owing a vast sum of money to your employer became a common practice at most companies. Might lead the way to higher levels of employee retention and may be seen as some kind of solution to people not doing their jobs or doing the bare minimum just for a paycheck, especially in undesirable but necessary jobs.

It's disgusting as hell so yes, I wouldn't be surprised to see it in the next few years. Maybe when you start your new job, you have to pay them a $10k deposit, which will "vest" back to you over the next four years; quit early and it's gone!

Re: Bolt Financial's loans come due

#100

Post by JumpCrisscross »

berberous wrote: post #67
toomuchtodo wrote: post #32

Earlier quoted context omitted.

Can the SEC pursue Bolt for this?

For what? This thread is full of misunderstandings. What is it you think Bolt did that the SEC should pursue them for? If it’s alleged they fraudulently hid risks, etc., it’s one thing, but so far all that seems to have occurred is they offered something that has pros/cons, disclosed risks, half wanted to take the risk for the pros, and in hindsight, perhaps it was a bad deal since valuations are tanking industry wid…

> what is it you think Bolt did that the SEC should pursue them for?

Bolt offered, with multiple conflicts of interest, what are essentially margin loans to potentially unsophisticated borrowers. The $300 credit for a financial advisor the CEO tweeted about should, alone, be presumptive.

To be clear, I don't think anyone did anything intentionally wrong. (Also, I learned about this yesterday, so there’s that.) But wanton incompetence bordering on--perhaps crossing into--negligence, enabled by a Board that absolutely should have known better, can and should create liability.

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