I was employee #1. It sold to google. All employee options were wiped out.
because the vc's liquidity preference took precedence?
Ask HN: How much did you, as an employee, make when your startup exited?
111–120 of 175 posts
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#112Earlier quoted context omitted.
I wouldn't believe everything you read on the internet. I often see absurb compensation packages posted on HN and have never seen anything close to them in real life.
The fact that you are doubting the information I wrote in the previous comment, suggesting the parent poster to not necessarily believe them, is disturbing. I can only say I truly got those packages and I’m an average engineer. I suggest you ask to the close friends you have working at FAANG if those are true.
The 450k includes money for health insurance right and in lieu of stock? I heard that Netflix would allow you to select compensation based on how much risk you are willing to take.
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#113Earlier quoted context omitted.
The fact that you are doubting the information I wrote in the previous comment, suggesting the parent poster to not necessarily believe them, is disturbing. I can only say I truly got those packages and I’m an average engineer. I suggest you ask to the close friends you have working at FAANG if those are true.
The 450k includes money for health insurance right and in lieu of stock? I heard that Netflix would allow you to select compensation based on how much risk you are willing to take.
Mostly correct, though I’m sure there were some employer subsidy for the health plan, and the ability to get some more advantage from the stock growth via something similar to ESPP.
I didn’t dig too deep into that because I recklessly opted for the startup instead of FAANG :), but the best deal was FB: everything was paid for and they were also offering a fat sign on bonus of 100k
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#114Startup 1: $50k for 1 year (in the 90s, do the math what it would be right now)
Big company for some time
Startup 2: $0 for 2 years
Startup 3: $0 for 2 years
Startup 4: $0 for 2 years
Startup 5: $500k for 4 years
Startup 6: $1m for 1 year (still somewhat in play because 3/4 of my options got converted into the options of a public company as a result of acquisition, and I got RSU handcuffs on top of that)
All numbers before tax. I hope I'm done with my startup adventures. Lost taste for it.
Financially, based on my experience, startups do not make any sense as an employee.
Mentally, Startup 5 made me question my faith in humanity.
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#115First startup, I traded nearly all of my salary over four years for stock options: $0 Second startup, I was told I'd get 5% of the company (no contract though). I quit after a year without pushing the topic: $0 Third job was not a startup, but it was a fairly small company, and I've made nearly two million in tax deferred accounts having made a healthy salary the entire time. I'm retiring this year. I learned a lot o…
How long have you been at the third company? What kind of tax-deferred accounts allow $2M in deposits in less than 50 years?
That's about ~25 years if one is contributing ~25k a year (reasonable 3% match + 18k yearly limit) and the accounts are yielding a nominal 8%, which is not incredibly impressive (5% real give it or take).
Make the nominal interest 10% (probably more similar to the actual returns in the past two decades) and we get there in ~20 years.
Contribute more (e.g. backdoor roth and/or mega backdoor roth) and we get there much faster.
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#116First employee. Company sold for $1B in 6 years. $2.95m before taxes.
How much did you have when you initially joined, that got diluted to ~0.3%? I guess somewhere in the ballpark of 1.5%?
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#117It's really interesting to see $100M+ exits that have resulted in trivial sums for founders and early employees after multiple rounds of dilution and/or VCs with preferred shares taking home the spoils.
I have always optimised for salary although I can see why a young engineer with no dependants might opt for the gamble of a big payday instead, likely without really understanding their true chances.
Too much industry focus is heaped on 'unicorns' when these kind of companies really are a drop in the ocean.
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#118It's really interesting to see $100M+ exits that have resulted in trivial sums for founders and early employees after multiple rounds of dilution and/or VCs with preferred shares taking home the spoils. I have always optimised for salary although I can see why a young engineer with no dependants might opt for the gamble of a big payday instead, likely without really understanding their true chances. Too much industry…
> It's really interesting to see $100M+ exits that have resulted in trivial sums for founders and early employees after multiple rounds of dilution and/or VCs with preferred shares taking home the spoils.
My unscientific impression is that in 9 figure exits the founders typically do make money, because they typically retain enough equity even after significant dilution.
However, I have heard of high 9 figure exits in which nobody but the founders and VCs made any significant money.
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#119Startup 1: $50k for 1 year (in the 90s, do the math what it would be right now) Big company for some time Startup 2: $0 for 2 years Startup 3: $0 for 2 years Startup 4: $0 for 2 years Startup 5: $500k for 4 years Startup 6: $1m for 1 year (still somewhat in play because 3/4 of my options got converted into the options of a public company as a result of acquisition, and I got RSU handcuffs on top of that) All numbers…
> Financially, based on my experience, startups do not make any sense as an employee.
Absolutely. Also note that you are an extreme outlier for having had a 7 figure payoff.
Most people who spent their entire career in startups will be lucky to see a 6 figure payoff at any point.
Re: Ask HN: How much did you, as an employee, make when your startup exited?
#120Employee #40 at a medical device company after working as a contractor for one year and then asked me to join. Received a first round of ESOP options a bit under the valuation price ($20 at the time). Then RSUs as bonuses for the next 5 years. After company started to ship, shares went up and even reached over $100 at one point. Sold half of my stock between $70 and $90 and made around $450k before taxes. We were partially lucky that those were the recession years and investors were looking to put their money in less risky ventures, and as far away as possible from real estate.
I quit a couple of years before the company got bought by a major player, leaving my remaining unvested stock which would have been worth another $300k at the moment of the acquisition. Good money for me as my first job in the US, although not as good as a bunch of colleagues before me that were turned into senior management and made millions. Loved the job, and I would have stayed if they hadn't assigned me a new boss that, albeit not a bad person, his professional demeanor was awful.
Have worked for 3 other startups since then. The next one, also a medical device company, looked promising. Joined as their first contractor/employee but I could not secure equity. They also changed directions on their development so I left. Salary was not terribly low but half of what I usually make. They are currently supposedly doing well and are shipping product after 5 years, and received around $30M funding mostly from a Silicon Valley VC last year to accelerate their growth. I know other employees left after me for similar reasons. They got compensated even less than me.
The following one again as a first contractor/employee in the connected home space with some promises for equity if the company soared (founders had done that before and were successful, with strong ties to Apple). Salary was not superb considering my skills, but above market. However after 2 years the founders could not do a buyback and the company was absorbed by their single investor, a big security business that was just in the process of rolling their IPO. They only offered us employees options at market price with a lot of restrictions. They were also going to reduce my salary and obviously I didn't like the terms.
Currently almost two years at a SF startup, with all the pains of working and living in the preposterous SF zeitgeist under a small startup company salary. Own more than 1% of the company but I know it will get diluted after we receive our series A, and where I don't have much control of the circumstances.
Before all these deeds, founded my own startup with a friend right out of college, mainly building industrial systems. We were naive and business inept, never made serious money but managed to stay alive for five years doing some cool customer projects, having fun and learning a lot. Plus the gratifying feeling of having control over our destiny, even if it was a bit for a small period of time. Hands down one of the best experiences of my life.
There is a reason startups - technology startups in particular - are declining in number, specially in the US. The field is too mature, consolidated and institutionalized now. There are some niches and pockets of opportunity, however competition is intense. Sadly most affairs and regulations are rigged against employees, and if you are not being compensated at market level with all the associated perks, you will never get rewarded as you deserve as an employee compared to a founder or investor in the minuscule event that the business is successful.
If you really want to be part of a startup, first try to work at a FAANG type of company even if the idea does not appeal to you. Leverage their massive resources to learn and grow your wealth. Save enough to a point that you are comfortable and don't need to worry about money anymore, whatever that means to you. Then, and only then, if you still feel the need to scratch your entrepreneurial itch, make your move. The full monty - not as an employee but a founder. Your increased experience and business network will further increase your chances of success. And you will also have come across real industry problems that desperately need solutions. Win-win.
In this age where work is changing so fast and the future of security for workers is uncertain, hoping for the best and planning for the worst has more relevance than ever.
My 2c.