161–170 of 943 posts
I'd assume it's 'references', i.e. which school you went to, which university you went you, who you know/who knows you
Where are early employees from? Are they still from the same elite circles?
Everyone just buys that someone with a failed startup has capital that better founders lacked.
Invested in X with what Y bro?
I think it’s entirely reasonable for a founder to take money off the table. The founder possibly walks away from a 6-7 figure opportunity cost working for a big corporate or FAANG. In return they take zero salary. All of the money that begins to come in is then used to pay employees. Maybe they raise some funds and pay themselves a below market salary for years. A few years later they are over $1 million in opportuni…
First of all, it assumes everyone wants to work for those companies and assumes all founders could get such high paying jobs with a snap of the finger.
Secondary at Series A is very rare. Part of the reason more early employees don't get included in secondary sales is because of the Securities Exchange Act of 1934 14e-2. If you have more than 10 sellers involved, the transaction can be considered a tender offer, which triggers additional regulatory requirements and disclosures. > As of 4 months ago I left a very successful stealth startup (which grew to 40M in ARR i…
As a founder with multiple years of experience I can say that this post and a lot of other comments are coming from people who don't understand the life of a founder. It's not so much about risk. My peers earn 5-10x my salary. I'm paying my employees more than myself. I have to provide for 3 kids and we have a lot of debt on the house. I'm working day and night, 24/7. I don't like the phrase "taking money off the tab…
Earlier quoted context omitted.
The very first startup I joined after grad school allowed all employees to cash out significant chunks of their stock in the Series A round. Also Elon famously put 200 million of his own money into Tesla and SpaceX to keep it afloat, which is the opposite of cashing out early.
> to keep it afloat Can't "cash out" (early or not) if your company is sinking .
Earlier quoted context omitted.
I can share some details. Employee 1: ~1% Employee 10: ~0.1% Employee 1000: 0.01% I'm extrapolating from past experiences in SaaS companies where I was employee number X and X has varied fairly widely.
This always seems like a huge scam to me. Employee 1 gets 1%? It seems unfair from multiple perspectives. One is just a straight up naive sense of fairness. If I'm going to be in the trenches with you, I had better be able to see my ownership % in a pie chart with my glasses off. If we're out here both making chairs and when we sell a chair for $100, you get $85 (assuming someone took one of the standard-ish seed rou…
If I'm getting no pay, I'm definitely a co-founder, but I'm getting a pretty good salary from day 0, I don't think that's too bad.
Say you get offered $200k/y +1%, if things go well, in 4 years you got $800k in cash and your 1%. If things go south, you still got $800k, a cool title, worked on a hopefully interesting product with a nice team. Doesn't sound awful to me. No?
I was mentally, physically and emotionally worn out when I left my previous startup after being an early employee. Despite that I really wanted to stay and be part of what my friends and I were building. Had I had the chance to 'de-risk my life' with some equity to replenish my empty bank account, which was empty from taking an early employee salary, I may have been able to stay but in the end I had to get out. Getti…
If you were early, why didn't you purchase your options and file an 83b?
Fast forward four years of toil with multiple cycles of doubling and then halving headcount as well as endless leadership changes. We are now on our fourth CTO in as many years. On the upside things are starting to look up! The newest sales team have worked out how to sell the original product we built, not the bells and whistles we pivoted to on the wisdom of the overpaid CPO. We can now celebrate as we have about a year's worth of runway and can confidently project being cash flow positive in about six months.
The new ex-FAANG CTO earning three times as much as anyone in the original team has great news! As a result of the positive development we are now able to hire an extra development team in South America! This shouldn't cost us too much and they can start on the next greenfield effort. The existing developers need not worry about being replaced as the existing team has all of the experience with the money making side of the business, and besides the new devs will be working on a parallel offering anyway.
Four weeks later and we've onboarded two offshore devs. The VCs have demanded we cut our burn rate and my position is being made redundant. I have 90 days to exercise but my options are underwater, both when compared to the funds we raised a few months ago and also the FMV. Essentially to buy them now I would be worse off than someone walking straight off the street.