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DoorDash removing 1-year cliff for equity grants

blog.doordash.com

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Re: DoorDash removing 1-year cliff for equity grants

#51

Post by breck »

RussianCow wrote: post #23
londons_explore wrote: post #3

The 1 year cliff never really made sense... It effectively gave the company a discount on employees who stayed only 364 days - or to look at it another way, a 'trial period' of 1 year where the pay was substantially less.

Am I the only one that doesn't see that as unreasonable? It's not like you aren't accruing equity during that time; you still get the full year's worth of options at the 365 day mark. And the ramp-up time with new engineers can be so long that the first year isn't nearly as productive as consecutive ones. A buddy of mine who worked at a giant company (not strictly tech but you'd recognize it) said he heard from his b…

I think the larger the company the longer it takes to ramp up, but at a small startup you can have a big impact in month one.

I've always found the one year cliff funny, since investors don't have a cliff.

I've been hoping startups would start doing this for a while, and think DD is really a pioneer here and think this will become a trend. I know personally I turned down a few opportunities at promising startups simply because I was young, in my twenties, and a year felt like a long time. I found the probability of a life changing event that would require me to move and leave a company too high, and didn't want to bust my butt for 10 months with a salary cut, then have to leave and get no equity. So I said "no" to a few opportunities that otherwise would have been great.

Currently incentives first your first year are to focus on not getting fired. Now it can be on making an impact.

Re: DoorDash removing 1-year cliff for equity grants

#52

Post by jkaplowitz »

hrpnk wrote: post #36
londons_explore wrote: post #3

The 1 year cliff never really made sense... It effectively gave the company a discount on employees who stayed only 364 days - or to look at it another way, a 'trial period' of 1 year where the pay was substantially less.

A cliff forces one to consider decisions with a different time horizon and tends to avoid short-term thinking (e.g. attempt to tune financial results ahead of a certain quarterly report). Sometimes, companies include in their annual reports the conditions of employee shareholding plans. In Europe, for management, plans with 1 year vesting and 1-3 years blocking period is a practice. This means that you cannot exercis…

Having been fired once at the 10-month mark early in my career, not for misconduct and not after any prior performance warnings, the 1-year cliff can be heavily abused by employers. Your argument assumes the employee has the control over when they leave, which isn't always true.

(In actual fact I was then a pretty underperforming employee who misunderstood the situation, but the apparent trigger for me getting fired was my own request for help addressing the situation since I realized something was wrong. The startup founders were as early-career as me and didn't really know how to give me the feedback I needed. My next employer did give me the necessary constructive criticism, after which I made the necessary changes, got subsequent positive feedback from that same employer, and have been a decent to good employee everywhere I've been since then.)

Re: DoorDash removing 1-year cliff for equity grants

#53

Post by fshbbdssbbgdd »

bentlegen wrote: post #31

The article seems to intentionally obscure whether the previous vesting period was quarterly or not. My cynical read of this is that they are changing the vesting schedule to quarterly (instead of monthly, which is more typical), and burying the lede on that by painting this as a benefit to employees (when it really only impacts new employees). Does anyone know if this is true or not?

I’ve seen quarterly vesting much more often than monthly in offers from several different companies over the years.

Re: DoorDash removing 1-year cliff for equity grants

#54

Post by breck »

fallmonkey wrote: post #30

With Google doing front loading(33/33/22/11) and other companies also shifting away from conventional 25% per year vesting to make first few years more attractive, they gotta catch up to stay competitive. Uber recently did the same of removing cliff.

Do you have a link for Uber dropping the cliff? I didn't know they did that.

Re: DoorDash removing 1-year cliff for equity grants

#55

Post by oehtXRwMkIs »

bboylen wrote: post #47
digianarchist wrote: post #33

Earlier quoted context omitted.

Browsing /r/cscareerquestions it looks like entry level folks are having a hard time breaking into the industry. Employers are mostly recruiting senior levels it seems.

As a self taught guy transitioning from chemical engineering, I hope its not too hard. Starting my search in a couple months

Doing something similar, good luck. Can't tell if it's very difficult or very easy.

Re: DoorDash removing 1-year cliff for equity grants

#57

Post by rejectedandsad »

dahfizz wrote: post #41
digianarchist wrote: post #33

Earlier quoted context omitted.

Browsing /r/cscareerquestions it looks like entry level folks are having a hard time breaking into the industry. Employers are mostly recruiting senior levels it seems.

I think there is a bit of a selection bias going on in that subreddit. I finished undergrad last May and had multiple offers to choose from well before I even graduated. Maybe covid has slowed hiring since, though.

I only had 4 offers to choose from. It's a bimodal distribution between the 200K+ 0YOE folks and everyone else.

Re: DoorDash removing 1-year cliff for equity grants

#58

Post by mynameisvlad »

bentlegen wrote: post #31

The article seems to intentionally obscure whether the previous vesting period was quarterly or not. My cynical read of this is that they are changing the vesting schedule to quarterly (instead of monthly, which is more typical), and burying the lede on that by painting this as a benefit to employees (when it really only impacts new employees). Does anyone know if this is true or not?

> instead of monthly, which is more typical

Is it? Almost all my and my friends' RSUs have been quarterly, with a typically 1 year cliff as described in the article.

Re: DoorDash removing 1-year cliff for equity grants

#59

Post by whimsicalism »

jshen wrote: post #48
whimsicalism wrote: post #43

Earlier quoted context omitted.

Eh, I talk to a fair number of undergrads and I think it has been tough this past year.

Something is off then. Are they in big cities? Do they not know where/how to apply? We’ve had a hard time hiring anyone, including entry level.

I mean, what sort of compensation are you offering?

Also - I'm talking about last year, not now.

But I am recently out of college and have not even passed resume screen by a few companies despite referral, credentials, etc.

Re: DoorDash removing 1-year cliff for equity grants

#60

Post by devoutsalsa »

adoxyz wrote: post #2

Good, pro-employee move. Next, I'd like to see pre-IPO startups offer longer periods to exercise shares when you leave. 90 days being standard is way too low.

Is there any real incentive to offer more favorable terms to employees that plan to leave?
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