Earlier quoted context omitted.
Maybe OP wants a house in atherton next to andreessen.
I'm guessing it's a very select group of people who want a house next to Andreessen...
If I had to, I would pay just to live away from that select group.
Windsurf employee #2: I was given a payout of only 1% what my shares where worth
261–270 of 553 posts
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#262Earlier quoted context omitted.
So much more. What assets/patents do they own? How much money is in the bank? What does their liability sheet look like? How “hot” is their industry right now? Some time ago I found a good formula to plugin numbers and get a valuation multiple. The questions above were the ones that really moved the multiplier. A major lot of “startups” are in the 1-2x range. The hot ones will peak at 7-12x.
I suppose the industry is not hot right now. EdTech was never really very hot. It was 'luke warm' at best, a decade ago. They own a lot of software, also, they publish their own math textbook (both digital and print). They have licenses with thousands of schools across multiple countries. I don't recall they have any debt. I feel like they could easily bump up profits by $2 million just by letting go of people... But…
As you describe this is largely a cash flow business and the bulk of the value should be extracted via dividends to the benefit of major shareholders.
A tech enabled business needs gross margins north of 70% to be attractive from a leverage standpoint, unless revenue is scaling very rapidly. Without these there’s no attractive exit opportunities.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#263Earlier quoted context omitted.
for a standalone house in my area (lakeside near Zurich, Switzerland) you'd pay way more than 3M... apartments go for 2+.
Couldn't you just not live "lakeside"?
of course that's an option. then you can get a house for a measly 2 million! public transport will only take an hour or more from there .. :)
my wife doesn't drive and we wanted to have access to good public schools and good transportation. this is not a given if you go more rural. The postbus goes maybe every hour or so.
the lakeside communities near Zurich are great and all of our friends live in one of them (on the same side of the lake of course). not living here would have severe effects on my wife's and our kids' social lives.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#264Earlier quoted context omitted.
anything within 45 minutes of your office in palo alto (where you are mandated to show up 5 days a week). this will get you a 1300sqft piece of shit built in 1964 with asbestos and lead paint and lead pipes and a cracked foundation (also some dipshit realtor had them paint all the original wood beams and paneling inside gloss white and replace the original wood and slate floors with grey vinyl) from some baby boomer…
Every now and then I dream about how much more money I'd be making if I lived in the Bay Area, but then I read something like this and realize that earning ~half as much working remotely from a cheaper (at least when I bought) city maybe isn't so bad.
They are greatly exaggerating. One tangible advantage to living somewhere expensive with higher salaries is that anything you can buy online is effectively that much cheaper. An iPhone costs the same in Arkansas as in San Jose, so you'd end up working many more hours to buy one in AR than in CA, on average.
Yes, housing is more expensive. A lot more. Everything else is way cheaper.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#265Earlier quoted context omitted.
Every now and then I dream about how much more money I'd be making if I lived in the Bay Area, but then I read something like this and realize that earning ~half as much working remotely from a cheaper (at least when I bought) city maybe isn't so bad.
They are greatly exaggerating. One tangible advantage to living somewhere expensive with higher salaries is that anything you can buy online is effectively that much cheaper. An iPhone costs the same in Arkansas as in San Jose, so you'd end up working many more hours to buy one in AR than in CA, on average. Yes, housing is more expensive. A lot more. Everything else is way cheaper.
Services are also more expensive because the person performing the service must pay the high rents, too.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#266The details here remain unclear to me, and even this tweet is somewhat vague. > I was given an offer that would explode same day. I had to forfeit all of my vested shares earned over my 3.5+ years at Windsurf. I was ultimately given a payout of only 1% of what my shares would have been worth at the time of the deal. Was forfeiting the vested shares conditional on accepting the offer, or did he have no choice over the…
what are those shares worth with the company gutted? Seems like not much of a choice if leadership and IP are gone...
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#267Engineers: always negotiate for higher base salaries. In the vast majority of cases—especially during acquihires—your equity will be worth little or nothing. Founders and VCs still get paid; employees rarely do. Don't just accept promises. Ask for the 409A valuation, liquidation preferences, and pay bands. If a company won’t provide transparency, that’s your signal. Equity is a lottery ticket. Salary is money in the…
Under any normal circumstance I've ever seen, you should be taking the higher equity/lower salary combination and should focus on equity rather than salary. The only time it ever makes sense to push for more salary instead is if you literally cannot get a job at a public company (or even a near IPO unicorn). Plenty of startup employees can, so clearly they believe their startup equity is worth something. Financially…
First, your stock has a much higher than 50% chance of being worth less, even at the best startups. This is why early stage investors invest in so many companies… a vast majority are worth zero, but the few that make it big pay for all those and more.
This is why you would never see an early stage investor invest in only one company. They need volume to be able to survive the high risk/high reward nature of startup investing.
Now, maybe you think you are a better judge of the probability of success for your startup than an investor, so the risk is lower. You would be wrong; if there was a way to reliably predict which startup would hit it big, then investors (who spend all their time trying to predict exactly that, and have a lot more data and history to use in their evaluation than you do as an employee) would have a much higher success rate.
So even if you have a very promising startup, your equity is a huge risk. Your company probably won’t hit it big, and if it does you have to hope you aren’t screwed out of your equity by the millions of tricks they use to screw employee shareholders; dilution, preferred shares, etc.
Even worse, you are taking double risk. Your startup is risking both your equity AND your salary. You want to diversify your risk, so you can use your investment when your salary fails and use your salary when your investment fails. In this case, those both will fail together if your company doesn’t make it.
Look, equity and stock options are great, but you REALLY have to discount its value as an employee because of the way the risk shakes out as an employee.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#268Engineers: always negotiate for higher base salaries. In the vast majority of cases—especially during acquihires—your equity will be worth little or nothing. Founders and VCs still get paid; employees rarely do. Don't just accept promises. Ask for the 409A valuation, liquidation preferences, and pay bands. If a company won’t provide transparency, that’s your signal. Equity is a lottery ticket. Salary is money in the…
Yes - equity should be an incentive to contribute the the company's success, and partial compensation for the risk of going to a startup. One should value it at precisely $0 in terms of life planning. This becomes truer and truer the more of an employee and the less agency over the company's choices you have, but generally if you're not a co-founder (founding engineer doesn't count) equity traded off against salary i…
> equity should be an incentive to contribute the the company's success
the much bigger motivation is "keep the company afloat so i can keep drawing my salary", so just boring old non-equity paychecks provide plenty of motivation.
if you're an employee that thinks your contributions are so great that you are single-handedly juicing the stock price or valuation, you're probably wrong but if not... you should probably take those skills and found your own startup.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#269Earlier quoted context omitted.
> Yah, over 50% it's going nowhere but expectation needs to consider how huge the win is even if it is lower probability. yes that's literally the definition of expectation value...... so ev = 1 bagillion * 0.0000000000000001 = ~0 hence you should absolutely not be taking higher equity/lower salary ever. hell i wouldn't even take that at a publically traded company if given the option.
The interesting thing going on is, stars align. The kind of person who has to think about this problem should take equity. The kind of person who would choose to take cash isn't going to be hired at the kind of VC backed business that will end up being worth something.
Man this is a ridiculously naive take.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#270Earlier quoted context omitted.
I am convinced every executive and wanna-be executive is on the 'inside joke' of funneling money out of the company into their pockets. I am also convinced that investors believe it's the C Suite's responsibility to tear away any equity from employees to leave the largest pot for investors.
ive been in these rooms and heard the conversations, employees are seen as disposable liabilities
YUP
Terms and phrases I've heard verbatim from investors and/or founders:
"There's a thousand ways to screw minority shareholdeers."
"Cram-down" (repeatedly, like it is an ordinary thing to do, effectively repudiating or diluting away entire classes of debt and/or equity)
"I hate to lie, but you often have to." (said as if there is no choice in the matter)
"You have to screw the other guy before he screws you."
"If there's a problem in a joint venture and you put out the resources to fix it, you're the chump."
It is a good idea to not do business with people who say these kinds of things.
It is delusional to think you will be the special one who they actually treat fairly and not be targeted by their greed and lack of ethics.
If you are really lucky, you will escape and find an attny willing to take your case and win a lawsuit and still get to chase them for the judgement.
The only winning move is to not play.
(Not to say there are no honest ones, but it is really getting scarce, and many honest ones have left the biz.)