361–370 of 413 posts
I think lot of these idiosyncrasy stems for arcane SEC rules like 500 investors and restrictions on IPOs. Startups and tech community should lobby to change all these. Why can't we have full fledged public exchange where anyone, any startup can come in and sell its stock with no restrictions at all. If people want to buy in to their vision, sure let them be. Lot of rules around IPO and SEC are placed to protect the g…
There are other solutions: 1) The company could offer to buy back options at market rate. 2) The company's current investors could offer to buy equity from employees. The majority of investors returns come from a small number of portfolio companies, for those companies that are doing well the investors want a bigger stake even if it comes in as secondary. 3) Companies could appoint designated investors who could buy…
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I wouldn't even call this inflated in the valley anymore. There are outliers making serious money right here, right now. Such a salary pairs nicely with our lovely $1M+ median house price to insure we can never afford to buy one without living like a monk or going up to our eyeballs in debt. If you don't believe me, then just who's buying those $2M+ houses that stay on the market a week or two? SPOILER ALERT: Double…
Congratulate yourself, because you are, for sure, a fortunate outlier! I don't doubt that there exist engineers out there making $250K+, but they are definitely not the norm, big company or small. Check out a bigger sample of Bay Area companies on Glassdoor. My bet is you'll find the middle 90% to be between, say, $90K and $150K.
http://www.glassdoor.com/Salary/Google-Senior-Software-Engin...
About 250k in total comp. A lot of it is in stock grants, but those are completely liquid.
With RSUs, you are rewarded for meeting high expectations. With options, you are only rewarded if you dramatically beat already very high expectations.
In this market, I tend to think of options as incentives, and not as replacements for salary. Salary gets me in the door and work hard, great people and culture make me want to be there and evangelize, and options incentivize me to work my ass off. (I'd work my ass off without options, but the options really make it easy to say "I will do everything in my power to make this succeed" instead of "I'd rather go spend ti…
As someone who was a 1st employee at a small startup (who made the mistake of accepting 50% below salary for a few percentage points of equity), this rings very true to me. However, my empathy goes out to early-stage (pre Series-A companies)...how do you get those engineers then if you, yourselves, have no money and know that equity doesn't pay the bills. Is it through revenue/profit sharing? Cause I would imagine if…
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You're the second person on this thread to bring vesting (and "cliffing") into the same sentence as liquidation preferences. They seem like totally unrelated concepts. Preferences are a trap (for everyone in the company, founders included): if the company takes money at an ambitious valuation, their investors probably have terms that claw back their money if the company sells for an unspectacular number. Vesting and…
Vesting resets wouldn't apply to an IPO, but they'd apply to an acquisition where the bought company is paid-for in stock and vesting applies to the new stock. Let's say that the employee has 0.4% (after dilution) of BuzzFlop with a 4-year vesting cycle. After 2.5 years, BuzzFlop is bought by Hooli for $100M in Hooli stock. The employee doesn't get $250k in walk-away cash, but $250k in Hooli stock, subject itself to…
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I tend to think of options as worthless, until they vest. Which is too far in the future to count on. Pay me money. That's actually useful.
I used to also believe this, and would parrot it every chance I got, but I've since changed my tune. It's hard to value options. Really, really hard. Saying they're worthless, though, is lazy and counterproductive. If you're joining a seed-stage private company, then yeah, it probably makes sense to so heavily discount the options package that maybe it is close to worthless. But if you're joining a series C that's on…
Anyone who makes decisions based on the prospective value of options is a sucker. They are a nice bonus when they work out.
You're right that options in a reasonably well-established company can have some value, but such companies can also afford to pay a decent salary, and should.
In some situations startups just don't have enough money to offer and the only thing that they could give is stocks. In those cases it is a matter of negotiating bigger cut of options to compensate for small salary.
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> I can't pay my rent with options. This indicates that what you're looking for at the moment is cash, not ownership over assets. This is fine. However, this preference is by no means universal. I imagine that beyond certain amount cash isn't useful anymore and you begin looking for ways to invest it anyway. Generally, cash loses value due to inflation, but offers high liquidity (you can spend it right away). Many ot…
That liquidity is important at the point of compensation - if you hold cash, you can invest it in what you choose.
This.