The title of the article is mostly clickbait. Anyone who's lived in SV for a decade or so knows this well. Startups are a scam unless you are a founder. They are a meat grinder that runs on naive young new college grads who buy into the bullshit that their options are worth anything.
Silicon Valley's best kept secret: Founder liquidity
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Re: Silicon Valley's best kept secret: Founder liquidity
#12You get Founder Liquidity because you managed to convince people who do just as much work that they couldn’t do just as much work without you. LOL
I am so cynical.
Re: Silicon Valley's best kept secret: Founder liquidity
#13Love the movement and glad there are founders out there pushing the envelope for their team. (aside: 51 points but only 1 comment? It's a front-page worthy article, but sort of feels like there's some vote gaming happening. I've never seen 50 points w/ 1 comment.)
I'm one of those people who upvoted without commenting. I think it's just a way of saying, "I found this article interesting / I agree with the content, but I don't have anything of value to add".
But hey I just commented :)
Re: Silicon Valley's best kept secret: Founder liquidity
#14Making less money isn't really the risky part about founding a startup. The risky part is missing out on years of other life experiences, stressing (or losing) your closest personal relationships, failing and feeling personally responsible for disappointing everyone you convinced to believe in you, and developing an anxiety disorder (or worse) from chronic long-term stress.
Author's suggestion that they could have taken a "similar level of risk" as an early employee by taking secondaries as a founder is way off, IME.
Re: Silicon Valley's best kept secret: Founder liquidity
#15Love the movement and glad there are founders out there pushing the envelope for their team. (aside: 51 points but only 1 comment? It's a front-page worthy article, but sort of feels like there's some vote gaming happening. I've never seen 50 points w/ 1 comment.)
It’s a vote bait title. (Type of thing people upvote without reading the article)
Re: Silicon Valley's best kept secret: Founder liquidity
#16The best startups have a concept which is summed up thusly: “We all go to the pay window at the same time.” It’s ok for founders to take a little bit of money off of the table if they extend that to their employees as well. Asymmetry is where things get weird. I’ve seen many founders who got deep into the fundraising cycles without ever realizing they could take a cent out. VCs will constantly tell you to let it all…
I have seen a lot of companies, a lot of rounds. I have known zero founders who have turned down an option to take money off the table (and zero A raises that offered that to employees). I love the idea of your universe, though.
Re: Silicon Valley's best kept secret: Founder liquidity
#17We are talking SV here, and that's very different from my European experience. I've known of founders in Scandinavia who walked out from startups that weren't doing so bad and that could have gone for another round of investment because they were earning as much as a bus driver, had zero savings, and were experiencing burn out after almost a decade of work. Maybe that bit of SV culture that lets founders be on par with a highly paid engineer at a big company is up to something. Maybe if it were more of a thing in other parts of the world, we would be more competitive.
Re: Silicon Valley's best kept secret: Founder liquidity
#18I’d also push for allowing early exercise along with secondary sales restricted only by a short right-of-first-refusal period.
> allowing early exercise along with secondary sales restricted only by a short right-of-first-refusal period Do you mean cashless exercise?
I think he means 83b early exercise: https://www.esofund.com/blog/early-exercise-options-83b-elec...
Extremely beneficial when paired with QSBS and liquidity.
Re: Silicon Valley's best kept secret: Founder liquidity
#19Founder liquidity doesn’t make up for much in the average situation.
Making $400k after making $100k for 4 years doesn’t really change much.
It gets you upto junior engineer level.
The underestimated play is becoming a cofounder to a great CEO 2nd time founder.
Re: Silicon Valley's best kept secret: Founder liquidity
#20Making less money isn't really the risky part about founding a startup. The risky part is missing out on years of other life experiences, stressing (or losing) your closest personal relationships, failing and feeling personally responsible for disappointing everyone you convinced to believe in you, and developing an anxiety disorder (or worse) from chronic long-term stress. Author's suggestion that they could have ta…
Perfectly illustrated by this statement:
> I have been an early or first engineer at five different companies and have had three liquidity events in a 9-year career.
A "big" success is a 10+ year journey. For an early employee, it is perfectly acceptable to give a few weeks' notice and move on to the next lotto ticket. This doesn't work for a key founder-exec -- they're likely going to commit to a decade working on one big problem, and investors want to incentivize them to shoot for the moon & stick with it for the long haul.
It's definitively not the same for an early employee.