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The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

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Re: The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

#21

Post by justjimmy »

bryanlarsen wrote: post #10
justjimmy wrote: post #5

Thanks for the read and ditto on the 5 pages needing to be viewable in just 1 page.

The full article is close to 100 paragraphs. Putting that all on one page would intimidate and lose a bunch of readers. Even choosing to put 15-20 paragraphs on a single page makes it a "wall of text" that will put off many readers. Of course, the real problem is the short attention span of the Internet age but it's hard to fault them for trying to avoid scaring off users.

Someone should split test this :D

Half view the pagination version, half view the 1 page version – and see % of the users that actually finish the article.

Re: The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

#23

Post by cperciva »

damoncali wrote: post #18
cperciva wrote: post #14

It seems to me that the lesson to learn here is to be careful about agreeing to vesting. Pre-series A, the three founders owned most [1] of a company which had a $6M pre-money valuation and was "on track to hit $1M in revenue" for the year. Post-series A, they each owned less than 3% of the company outright, with the rest of their shares vesting over four years [2]. What sort of idiot takes a deal which reduces them…

I don't know... You should probably subject everyone to vesting everyone at incorporation - to keep people from ditching early with a huge slug of equity. Good investors know this, and will often rightfully insist on some sort of vesting reset - depending on circumstances. It doesn't make you an idiot to take that deal. It makes you a part of the VC machine. It's just how it works. That said, I've seen people raise (…

You should probably subject everyone to vesting everyone at incorporation - to keep people from ditching early with a huge slug of equity

At incorporation, sure -- because at that point the entire value of the company is the work the founders will be doing in the future. But in the case of yousendit, they implemented vesting at a point where the company already had a significant value; the fact that it was able to survive having two of its three founders fired indicates that their contribution was made before the Series A, not after.

It doesn't make you an idiot to take that deal. It makes you a part of the VC machine. It's just how it works.

I'd say that anyone who accepts "that's just the way it works" as an answer is an idiot, but maybe that's just my cynicism showing. :-)

Re: The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

#24

Post by mmaunder »

damoncali wrote: post #18
cperciva wrote: post #14

It seems to me that the lesson to learn here is to be careful about agreeing to vesting. Pre-series A, the three founders owned most [1] of a company which had a $6M pre-money valuation and was "on track to hit $1M in revenue" for the year. Post-series A, they each owned less than 3% of the company outright, with the rest of their shares vesting over four years [2]. What sort of idiot takes a deal which reduces them…

I don't know... You should probably subject everyone to vesting everyone at incorporation - to keep people from ditching early with a huge slug of equity. Good investors know this, and will often rightfully insist on some sort of vesting reset - depending on circumstances. It doesn't make you an idiot to take that deal. It makes you a part of the VC machine. It's just how it works. That said, I've seen people raise (…

Our series A investors wanted vesting and we said no. They were cool with it. Vesting for founders is insane. Never accept it. Vesting for execs is mandatory and has saved me once already, ironically because our investors demanded it.

Once again I'm surprised at how very very few founders have a thorough knowledge of what they're signing up for and how to get what they want. It's your company. Act like it. You don't need permission and nothing is "standard". Also think hard before you get into bed with A level VC's and angels and make sure you are on your A game because the worlds most skilled investors come with a heavy premium.

If you're bringing real value, there's nothing wrong with saying no.

Re: The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

#25

Post by andyl »

It would have been valuable to Shaikh if he had someone he trusted who could counsel him to just chill and not shoot himself in the foot. What happened to him at YouSendIt doesn't seem fair to me, but sometimes life is that way. Now he could learn from his experience and give it another go. Good luck to Shaikh and his family.

Re: The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

#26

Post by [deleted] »

damoncali wrote: post #18
cperciva wrote: post #14

It seems to me that the lesson to learn here is to be careful about agreeing to vesting. Pre-series A, the three founders owned most [1] of a company which had a $6M pre-money valuation and was "on track to hit $1M in revenue" for the year. Post-series A, they each owned less than 3% of the company outright, with the rest of their shares vesting over four years [2]. What sort of idiot takes a deal which reduces them…

I don't know... You should probably subject everyone to vesting everyone at incorporation - to keep people from ditching early with a huge slug of equity. Good investors know this, and will often rightfully insist on some sort of vesting reset - depending on circumstances. It doesn't make you an idiot to take that deal. It makes you a part of the VC machine. It's just how it works. That said, I've seen people raise (…

[deleted]

Re: The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

#27

Post by jpdoctor »

mmaunder wrote: post #24
damoncali wrote: post #18

Earlier quoted context omitted.

I don't know... You should probably subject everyone to vesting everyone at incorporation - to keep people from ditching early with a huge slug of equity. Good investors know this, and will often rightfully insist on some sort of vesting reset - depending on circumstances. It doesn't make you an idiot to take that deal. It makes you a part of the VC machine. It's just how it works. That said, I've seen people raise (…

Our series A investors wanted vesting and we said no. They were cool with it. Vesting for founders is insane. Never accept it. Vesting for execs is mandatory and has saved me once already, ironically because our investors demanded it. Once again I'm surprised at how very very few founders have a thorough knowledge of what they're signing up for and how to get what they want. It's your company. Act like it. You don't…

> Our series A investors wanted vesting and we said no.

It's really a noop on their part. They know full well that if a founder ever leaves the company they can recover the ownership by diluting the bejesus out of him after he's gone (and bonus: everyone else who has already left is also diluted to near-zero).

Vesting just saves them the energy they'd have to exert on the backend.

Re: The Forgotten Founder: A Silicon Valley Tale of Humiliation and Revenge

#28

Post by samstave »

jpdoctor wrote: post #4

> He says his termination agreement prohibited him from contacting them [other employees] That pretty much tells you everything you need to know about the management and board. The clowns probably included a one-way non-disparagement clause as well, which is quite humorous in light of this article. BTW: Standard etiquette in the valley is for the employees to contact anyone who has just left the company, usually in e…

The worst company I have ever worked for, Device Anywhere, tried to get me to sign a one-way non-disparaging agreement as a condition on my receiving a 4K severance. I refused.

The CEO was an asshole and was having the company pay for his candy red porsche as well as taking a hefty portion of the sales commissions whilst laying people off due to lack of funds.

I hated that company. Never sign one of these agreements.

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