Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Any stories of employees with equity successfully taking home over $1m? $500k?

news.ycombinator.com

Post reply on HN
Print view View original

161–170 of 207 posts

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#161

Post by tacon »

robrenaud wrote: post #147
jjoonathan wrote: post #70

Earlier quoted context omitted.

I don't think there are many who would seriously suggest that YC/PG have bad intentions but survivor bias can have exactly the same effect. So can a "big picture" view: a 90% probability of failure might not seem nearly so bad to someone who can hedge by investing (not necessarily just $) in hundreds of companies. Expectation maximization is much more appealing when you have enough trials to get one of them off the g…

It seems rational for entrants in a YC class to all invest in each other, to hedge the failure risk. Why doesn't everyone in a given YC class (say, of 100 people) agree to give 10% of their company to a holding company, in response for 1% ownership of that holding company?

Founder Institute has something like that model. I haven't heard of any breakout successes from them yet.

http://fi.co/

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#162

Post by larrys »

snowwrestler wrote: post #158
GFischer wrote: post #58

Earlier quoted context omitted.

I was not aware of his story... ouch: http://en.wikipedia.org/wiki/Ronald_Wayne "He sold his share of the new company for US$800, and later accepted US$1,500 to forfeit any claims against Apple."... "Had Wayne kept his 10% stock until then, it would have been worth approximately $60 billion."

Not a bad time to remember that Ron Wayne has said he does not regret getting out of Apple. $60 billion is incomprehensible to most people. It's money so big that it is not money anymore, it's the power to make society-level decisions. In a sense it is so big that it becomes an obligation--see Bill Gates and Warren Buffett. Steve Jobs himself was not nearly that rich because he made decisions for reasons other than m…

"$60 billion is incomprehensible to most people. It's money so big that it is not money anymore, it's the power to make society-level decisions. In a sense it is so big that it becomes an obligation--see Bill Gates and Warren Buffett."

Add to that that not everyone wants to live in a fishbowl. Some do of course, but there is something to be said to having enough money to have a nice life, and some toys, and homes, and be able to do what you want when you want, but not be on everyone's radar and a potential target because of notoriety and wealth.

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#163

Post by citizens »

arasmussen wrote: post #131
BadCookie wrote: post #115

Earlier quoted context omitted.

Stories like this one make me feel foolish. I recall not applying to Twitter in 2008 partly because I thought that they were already too successful and famous for the equity to be worth much. Clearly, I was mistaken. (It is a small comfort that I probably would not have received an offer anyway, due to my skills and experience level not being a great match for the open positions that they had at that time.)

Go work at Uber :P

According to their angel.co page, they are not offering equity: https://angel.co/uber/jobs/

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#164

Post by hkarthik »

ChuckMcM wrote: post #134
hkarthik wrote: post #55

Earlier quoted context omitted.

Wow, talk about lost opportunity. I can only assume you're willing to talk about leaving so much money on the table because you got some other windfall a few years later!

Not sure why your getting voted down but once you've experienced the ups and downs of equity value it gets to be quite noisy. So the car I sold to used car dealer which I "paid" 1.6M for was replaced by another car I had bought using some stock money I got from a company that had acquired my startup, when I sold that car 5 years later the stock used to buy the car was worth a bit less than $400. Sometimes you win, so…

Yeah not sure where the down votes are coming from, but I appreciate your response and I think it's great advice for the folks in this thread.

When I was in my early twenties I scraped together about $5K which I was planning to invest in the Google IPO and instead used it to buy my wife her engagement ring. Today that stock might have been worth $50K or more.

So while some may see it as lost opportunity, I've enjoyed a wonderful marriage for 10 years as a result of that decision, and I don't regret it one bit.

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#165

Post by quietone1 »

I was an mid-seniority employee and netted in the low eight figures when I sold my equity stake after our IPO.

A couple important points I didn't see others mention: 1. When I got an offer, I asked if I could take a lower salary to get more equity. They said yes.

2. I pre-exercised all my options. So as far as the IRS was concerned, there was no tax liability when I exercised the shares. This meant by the time I sold, it was a long term gain instead of a short term gain on a same-day exercise+sell. Highest federal + CA income tax rate is 53%, so I would have kept less than half if I didn't get to pre-exercise.

3. I was able to sell when the Bush-era tax cuts were in place. So LTCG federal + CA rate was 25% for me. If I sold those shares today, it would be 37%.

So it worked out for me, but I'm still an engineer and 99% of my coworkers aren't rich - which means I don't talk about it, I don't flaunt it so no Lambo in the parking lot, and I still try to nod in sympathy when they tell me about how expensive private school or summer camp is for their kids. In other words, my life hasn't changed much aside from my bank accounts.

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#166

Post by ritchiea »

breischl wrote: post #81
ritchiea wrote: post #69

Earlier quoted context omitted.

I would argue there is value in the bubble payout itself. Even if you're good at saving & investing over the course of many years the assets and liquidity you have when you cash in your equity gives you a chance to take risks and meet potential business partners that you don't have as a salaryman who's good with his money.

That might be true as a rule of thumb for the general population. Although historically people who get large payouts (eg, lottery winners) tend to do very poorly with them. And for someone who is truly "good with money" to the extent of avoiding all lifestyle inflation and investing as much as possible, the periodic payouts are definitely better. For the sake of argument, let's say that you have two positions which w…

Realistically do you think a lottery winner is comparable to a successful startup employee? Lottery winners are entirely random while startup successes comes after years of working in a structured business environment with a built in community of successful business people. A lottery winner could be a guy in small town Tennessee who got lucky while he worked at the local corner store and has a group of friends & family asking for his money. A startup success is one or two social ties away from Sequoia or Peter Thiel, has meaningful work experience and has a group of friends actively trying to make him more money. There's a huge difference.

And I honestly don't mean this to be dismissive of a "typical lottery winner." The social environment you live in is a huge deal. Being in the SV community is going to lead you down a path of investments that typical lottery winners don't have immediate access to. If you win the lottery and Warren Buffet is a family friend you're much more likely to do well than if you win the lottery and your mother was receiving food stamps when you were in elementary school. Business people will answer your email, almost anyone's email, I'm not a big deal by any stretch of the imagination but I've chatted with Gary V and exchanged emails with Paul Graham. If lightning struck and I had a suddenly had a bunch of money to invest I could ask for powerful, connected help and there's a good chance I would get it from someone because no one cares how you made the money in your bank account. But at the very least I know where to look for that help, random lottery player guy doesn't necessarily have that and that's just his environment not anything inherent about him. Startup employee who cashed out is probably a lot more like me than typical lottery winner.

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#168

Post by nicholasdrake »

taude wrote: post #100
nicholasdrake wrote: post #56

a lot of top engineers are understandably going ot be risk-averse about taking low-salary for equity in a company that most likely will not work out... this however is not good for vc firms, because for their investments to work out they need to be able to hire the best hackers (away from places like google and facebook) . this makes me thikn there might be value in vc firms having hackers on their books, hired guns…

I'm not convinced that top-funded tech companies don't still pay great salaries AND give a small smattering of stock options....to keep the employees motivated and to attract the level of talent they need to succeed.

yeah it's difficult to tell... the narrative from all the vcs is it's all about the team, pg even goes as far to say that if you choose good people even if they initially have a bad idea they'll pivot out of it... but given the high percentage of start-ups that fail would seem to suggest that a lot of 'teams aren't up to it' i.e. there is a lack of talent going into start-ups... if that's the case it doesn't seem unreasonable to think some of that talent might be in big lucrative jobs at established technology companies

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#169

Post by bbcbasic »

I notice all the answers so far are in the US. Any UK or Australia stories to keep my hope up?

Interesting to see 250k is a realistic salary for a developer as well. I never see any jobs anywhere near that in the UK or Australia - except maybe London as a contract developer in finance.

Re: Any stories of employees with equity successfully taking home over $1m? $500k?

#170

Post by gpapilion »

Eridrus wrote: post #110
gpapilion wrote: post #46

I would say as a general rule, you either need to be in the A round of something REALLY big to survive dilution, for an acquisition. The alternative is that you join a public company or soon to be, that will have a very high market cap. Big companies routinely pay equity packages in the $200k-$1m range for senior people. Some just pay you in cash, and let you make the choice on how much equity you're up for. I've bee…

Could you give some more info on what typical dilution looks like from Series A to an exit?

It depends on the structure of the deal, and varies. The larger worry for most employees would be liquidation preferences. The investors tend to protect themselves, and often times this requires a 2-3x return before an common stock sees any money.
Post reply on HN