Earlier quoted context omitted.
One block from the freeway, no less.
Convenient for the commute.
[deleted]
Windsurf employee #2: I was given a payout of only 1% what my shares where worth
471–480 of 553 posts
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#472Earlier quoted context omitted.
There is actually a sense to the dilution. If I have something I think is worth $10m, and I'm asking someone else to give me another $10m, doesn't it make sense for that person to own 50% of the company? Why would any investor give you $10m wile receiving no ownership of the company? How are you going to give these newer investors ownership, if you don't reduce the ownership of everyone else? The claim in the tweet w…
I don't think I understand. If the value of a company is $10m and the company asks an investor to give $10m in exchange for equity, the investor should own 100%. If the value of a company is $20m and the company asks an investor to give $10m in exchange for equity, the investor should own 50%.
> If the value of a company is $10m and the company asks an investor to give $10m in exchange for equity, the investor should own 100%.
That's not investing, that's buying. Buying means the buyer gives $10m to the previous owners, at which point as you say, the previous owner owns 0% and the new owner owns 100%. But the company is in the same position as it was before -- the same amount of cash on hand as it did before.
For investing, you're putting cash into the company's account, which raises the total value of the company.
Value of the company before investment: intangibles + pre-investment cash - debt = $10m
Suppose I own 10% pre-investment; 10% of $10m is $1m of estimated value.
Value of company after the investment: intangibles + pre-investment cash - debt + $10m == $20m
Now I own 5% of $20m, which is still $1m of estimated value. The investor owns 50% of $20m, which is still $10m of estimated value.
In practice of course, there are different classes of shares which end up being paid out differently.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#473Earlier 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.
I forgot to factor in the time/quality of life cost of dealing with snow, winter heating, shoveling drive/roof, driving and driving risk.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#474I was aquihired by a FAANG. The headline "startup bought for x million" is almost always a lie, either direct or by omission. First, when a startup is bought, its generally not bought at the headline rate. So if you see a "bought for $45m" that doesn't mean People who own shares all got a % of 45m. That number is normally bullshit, but also a "total package" which include share offers for joining the new company. Thi…
$1M in one shot leaves you with around $600K after taxes in most states. That’s enough to pay you around $24-30k/yr. Unless you already had several other million saved already, I bet you’d be working again.
Sure, buts its a solid career break for a year.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#475https://x.com/ahmaurya/status/1948491614160122308 Garry Tan posted "sounds like a tweet that cost $20M" which he later deleted. Smells like a strong bias against employees in favor of management and founders.
I believe Tan's words were mis-represented. I believe he is saying that it cost Prim $20M and he then wrote that post. I don't think he is insinuating anything else.
i read it the same way but i have no context to be confident in that reading
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#476Directly contradicts Garry Tan's post saying that all forty founding engineers got seven figure payouts from the Google acquisition: https://x.com/garrytan/status/1947072583092052406 Even if the OP considers the full headline number of $2.4b to be the value of the company, and taking his "1% of fair" number as truth, seven figure payouts would imply all 40 founding engineers had >4% equity which is nonsensical.
> 40 founding engineers Forty founding engineers? Seriously? They must have a very expansive definition of founder.
'Founding engineer' is the new 'Vice president'
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#477Earlier quoted context omitted.
Redwood City is 20 mins from Palo Alto and has a lot of houses for $1-1.5M. $3M means you are paying extra for something optional. It’s not the minimum requirement. Lots of people are paying millions extra just to live up winding roads on a hill, where the commute is longer, and you need a geotechnical engineer to design your patio.
it’s more like 30-50 min with traffic
30 mins - possible with traffic, especially to a far corner of Palo Alto.
50 mins - what on earth? Take the train. Even a bicycle would be faster.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#478Engineers: 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…
Working at a startup pretty much always involves trading off money in the bank for other things. That’s the industry’s whole deal. Which is why I stay in Big Tech with liquid RSUs.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#479Earlier quoted context omitted.
Redwood City is 20 mins from Palo Alto and has a lot of houses for $1-1.5M. $3M means you are paying extra for something optional. It’s not the minimum requirement. Lots of people are paying millions extra just to live up winding roads on a hill, where the commute is longer, and you need a geotechnical engineer to design your patio.
Redwood City has terrible schools (relatively) and many people consider excellent schools for their kids as hard requirement.
School quality in the Bay Area is a red queen’s race, and a pressure cooker environment is not good for the kids. Apparently the solution is grade-separating Caltrain.
Re: Windsurf employee #2: I was given a payout of only 1% what my shares where worth
#480Earlier quoted context omitted.
> Acting like this employee was silly for not dumping a huge sum of money into company shares before it was in a position to succeed is flatly ridiculous. Once again we’re talking about employee #2, exercising early would not have been that expensive! They had access to a strike price and low tax liability that the vast majority of later employees would ever see. You are correct in that most shares in startups are wo…
> Once again we’re talking about employee #2, exercising early would not have been that expensive! Exercising early almost certainly would have cost hundreds of thousands of dollars. For employee #2 of a startup, you’re almost certainly already working for mostly equity and not salary. You are high as a kite if you think it’s reasonable to dump large sums of money into a five-person company while getting paid peanuts…
Without details we’ll just have to agree to disagree, but exercising options is not an all-or-nothing affair and can be done with a budget in mind.