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Windsurf employee #2: I was given a payout of only 1% what my shares where worth

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Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#411

Post by cornholio »

jongjong wrote: post #240
wanderlust123 wrote: post #227

Earlier quoted context omitted.

Why are the margins so low?

They have a lot of employees. I think over 50. Probably more than they need and they re-invest a lot in the business. Also, the cost of $15 per user per year is VERY LOW.

50 employees generating 6.5 mil in yearly sales means the business would barely cover payroll and basic expenses in a first world country. In a lower income country, they can be profitable by taking advantage of cheap labor, but that usually does not scale well to international markets in services.

0.2 % of that is nothing.

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#413

Post by lotsofpulp »

xvector wrote: post #301
karmasimida wrote: post #171

Earlier quoted context omitted.

Not contracting. Let’s do a simple math. Assume this employee gets 5% of the company (which is super unlikely, but let’s go with it), that is 150m for what could be worth if OpenAI deal went through. 1% of that would be 1.5m. That is still 7 figure. But this person spent 3 years in a startup, which turned out to be a unicorn and super highly successful, and he bagged a FAANG salary man pay at the end of the deal. Bas…

It's bizarre to see tech bros, YC, and megacorporations kill the startup talent pipeline that they rely on so much. Who is gonna want to work at a startup in a non-founder role after this and Scale AI? This continuing degradation of, and flagrant disregard for social norms is destructive for society.

This is not a new dynamic. This situation has existed for 10+ years, you can even read the same comments in the same HN threads from 10 years ago.

Equity is only to be valued at greater than $0 if the business is publicly traded.

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#414

Post by grego »

all2 wrote: post #310
kortilla wrote: post #294

Earlier quoted context omitted.

Pitching a 45 minute commute as as something as acceptable for $3 million is insane. It has nothing to do with class. That’s a shit life driving that every day.

I do a minimum of 2 hours a day. I think people in this particular conversation might be just a little divorced from reality.

I've spent all my working life in jobs with the rule that the commute should not be more than 30 minutes by bike. I'm now 62, and that's one life choice I've never regretted.

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#415

Post by Hikikomori »

fusslo wrote: post #192
stan_kirdey wrote: post #75

Engineers: 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…

my equity from 2years pre-acquisition: ~$2800. Then the CEO gave out bonuses when everyone threatened to quit. Then after his 3 month vacation to Italy, he came back driving his new Ferrari. My equity from 4 years ( employee ~60, grew to over 500 ): worthless. No one is able to exercise any options. They also readjusted when the valuation came below the total raised, making the value of my vested shares ~$13k ( down…

Paid more taxes on RSUs than I'm going to get post IPO. Company took investments on insane COVID valuation and then needed more money posts COVID which tanked it.

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#416

Post by cornholio »

fusslo wrote: post #192
stan_kirdey wrote: post #75

Engineers: 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…

my equity from 2years pre-acquisition: ~$2800. Then the CEO gave out bonuses when everyone threatened to quit. Then after his 3 month vacation to Italy, he came back driving his new Ferrari. My equity from 4 years ( employee ~60, grew to over 500 ): worthless. No one is able to exercise any options. They also readjusted when the valuation came below the total raised, making the value of my vested shares ~$13k ( down…

The basic idea is that you either have stock, preferably founder levels from 10% up (which is itself a lottery ticket), or you hold retiree bingo cards. The retirement home provides the cards for your entertainment, but the real owners of the establishment, the founders and early investors, know the only way you can earn the big prize is at their expense, so they have a vested interest to see you fail - and they are the ones printing the bingo cards and setting the rules.

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#417

Post by caminante »

Thorrez wrote: post #344
chasebank wrote: post #281

Earlier quoted context omitted.

I'm in Santa Barbara, CA. Good friend of mine just bought a shithole 3-2 1300sqft for $2.2m. $3M doesn't go very far considering 30 years ago it was retirement status almost anywhere.

Here's a $2M 4-3 2279sqft very-nice-looking home in Santa Barbara: https://www.zillow.com/homedetails/5436-Agana-Dr-Santa-Barba...

You're making his point.

4br in only 2k sqft? For 2M? Please...

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#418

Post by AngryData »

Retric wrote: post #312
johann8384 wrote: post #285

Earlier quoted context omitted.

With $3MM you could just stop working and live in many other nice enough places without ever having to work again.

3% of 3 million is 90k which sounds better than it actually is as you need to pay for health insurance. Plenty of people live in any city with less than that, but it is below the average income in many nice counties in the US.

90K is still 50% above the median income, not to mention the fact that you have twice as much as time available and using just a small amount of that can be used to cut costs significantly in other areas. It is more effectively a $150K income if we add in the median wage from the job you aren't doing.

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#419

Post by ponector »

occz wrote: post #149
ohdeargodno wrote: post #129

Earlier quoted context omitted.

Take a million, go live literally anywhere that isn't Silicon Valley, remote work for a company that interests you, or your own project. There's very few currencies in the world in which 1M isn't enough to retire. USD isn't one of them.

>There's very few currencies in the world in which 1M isn't enough to retire. USD isn't one of them. Unless you're planning on retiring as cheaply as humanly possible, 1M is not enough to retire for the large majority of the currencies in the world.

For majority of the world population 1M is amount they will never earn through their entire life. And they live just fine. I'm sure anyone can have a really nice retirement with one 1M, just not in the US.

Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth

#420

Post by Xylakant »

fragmede wrote: post #403
jjice wrote: post #296

Earlier quoted context omitted.

I had some RSUs from a previous company (likely will not be worth anything) and some options at another, but I have no idea how to understand how dilution like this works. My understanding is surface level of that scene in The Social Network. I feel like I understand _what_ an RSU is and what options are, but are there any good resources for me to learn from?

Dilution is where things get fucky. So you're working at this startup. Lets say it's worth $10 million. To make things simple, in this company, there are 2 people, the fucker, the CEO, the guy that started it all. He holds 90,000 RSUs, each worth $100, so $9 million, and the fuckee, you, who holds 10,000 RSUs, each worth $100, for a cool million. Here's where the fucker fucks the fuckee, ie you. The company does a ro…

You are misrepresenting how dilution works - and dilution usually is not what fucks you. Dilution is fairly straightforward - someone ponies up money and gets a share of the company. The valuation that gets handed around is usually what’s called “post money” - how much is the company worth after investors have paid in their money. In a simple example, matching your numbers, a company that is worth 10 million, with 10 million shares, each valued at 1 dollar with a 90/10 split finds someone who invests a billion dollars at 1 dollar per share. These shares are created as part of the acquisition. The value of the shares doesn’t change - the company, post money, now is valued at 1 billion 10 million and has 1 billion 10 million shares, each worth 1 dollar. It also happens to have 1 billion in cash at hand. No change in value for anyone here, but dilution happened - the person that owned 10% of the company pre-investment now only owns 0.1% - but the value of each share is still the same, which means they still own the same number of shares, each at the same valuation with the same total value.

The problem tends to be elsewhere - as part of the deal, the investor asked that his share get preferred treatment in the next round - a liquidation preference which grants them the right to first take their investment of the table and then, whatever is left is distributed. The company gets sold for 1 billion. The investor takes the billion that they invested off the table. There’s nothing left to be distributed. Your shares are suddenly worthless - just as the founders.

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