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Golden Handcuffs

avc.com

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Re: Golden Handcuffs

#71

Post by walshemj »

johnthealy3 wrote: post #50
choppaface wrote: post #4

The C-level to IC comp ratio is still way too astronomical. If a VC is telling you he feels there’s a better way to comp, he has a financial interest in ensuring your loss. Do not support investor-focused comp models like backweighted vesting (Amazon) or outright fraud like a start-up giving you a stock offer with no percentage or no 409A. Employees deserve high-quality equity on par with investors. The OP’s suggesti…

Agreed that it's right to be suspicious of the motives of any venture capitalist that makes a post like this (nothing against Fred Wilson personally). One thing I noticed at my last few startups is that the initial option agreements tend to have less diligence around them, say a very small strike price and more favorable terms on stuff like acceleration. Naturally, later-stage VCs would seek to skew the terms more in…

If Fred wanted to compensate employee shares he should be lobbying for banning some of the abuses dilution etc and for taxation only on a real gain

Re: Golden Handcuffs

#72

Post by walshemj »

drewg123 wrote: post #59
oblio wrote: post #58

Earlier quoted context omitted.

Why would they become less active in the fall? Wouldn't it make sense for them to be less active after January?

There was a mental perception that if you left just a "few" months from the yearly bonus payout, you were leaving money on the table. So people would normally leave in the spring and summer, but try to stick it out until the bonus if they were thinking about leaving in Oct. or later, since it was only 3 more months..

Its the same in finance

Re: Golden Handcuffs

#73

Post by walshemj »

drewg123 wrote: post #22

One of the things that I love about working for Netflix is that they just pay you every 2 weeks and that's basically it. There are no RSUs that are stacking up, no yearly bonus, etc. No smoke and mirrors. No internal websites to calculate the value of your compensation like at Google. I remember how much trouble the yearly bonuses caused when I worked at Google. In the fall, some people would become much less active…

The opposite side is two of my ex employers (one from 20 years ago) shares are still paying tax fee dividends in my ISA and increasing in value.

Re: Golden Handcuffs

#74

Post by [deleted] »

choppaface wrote: post #4

The C-level to IC comp ratio is still way too astronomical. If a VC is telling you he feels there’s a better way to comp, he has a financial interest in ensuring your loss. Do not support investor-focused comp models like backweighted vesting (Amazon) or outright fraud like a start-up giving you a stock offer with no percentage or no 409A. Employees deserve high-quality equity on par with investors. The OP’s suggesti…

[deleted]

Re: Golden Handcuffs

#75

Post by darod »

Is he misusing the definition for "golden handcuffs"? From my understanding, the issue is that an employee has 90 days to exercise one's options. Most can't afford to do so if the company isn't public due to the cost to exercise and the tax burden. I'm not sure how this new options structure addresses that.

Re: Golden Handcuffs

#76

Post by not2b »

kelnos wrote: post #70
joshuamorton wrote: post #67

Earlier quoted context omitted.

Why? Say you live in or near Atlanta, the rate paid to (on site) employees in Atlanta is less than the rate paid to (on site) employees in SF (I think this is true for pretty much every FAANG). Why should a remote employee in Atlanta make more than an onsite one?

> Why should a remote employee in Atlanta make more than an onsite one? Not more, but why shouldn't they be paid the same if they're doing the same work?

Markets don't care about justice. It's all about supply and demand. If a company needs people on-site in SF and also needs people on-site in Atlanta, it will have to pay the former more than the latter. If they don't, they will either be paying more (if they give the Atlanta folks extra money) than they have to or they won't be able to fill the positions (if they don't give the SF folks extra money).

Re: Golden Handcuffs

#77

Post by ghaff »

kelnos wrote: post #70
joshuamorton wrote: post #67

Earlier quoted context omitted.

Why? Say you live in or near Atlanta, the rate paid to (on site) employees in Atlanta is less than the rate paid to (on site) employees in SF (I think this is true for pretty much every FAANG). Why should a remote employee in Atlanta make more than an onsite one?

> Why should a remote employee in Atlanta make more than an onsite one? Not more, but why shouldn't they be paid the same if they're doing the same work?

Well, in the scenario you're responding to, you're actually asking why an onsite Atlanta employee should be making less than an onsite SF employee (based on the statement that remote should get main campus salary).

And the answer is market rates but a lot of people don't like that answer.

Re: Golden Handcuffs

#78

Post by voidfunc »

kemitche wrote: post #46
choppaface wrote: post #4

The C-level to IC comp ratio is still way too astronomical. If a VC is telling you he feels there’s a better way to comp, he has a financial interest in ensuring your loss. Do not support investor-focused comp models like backweighted vesting (Amazon) or outright fraud like a start-up giving you a stock offer with no percentage or no 409A. Employees deserve high-quality equity on par with investors. The OP’s suggesti…

Did Amazon return to back-weighted comp? The offer I received two years ago had comp that shifted from "cash focused" to RSUs over 4 years, and had equivalent cash value over the 4 years. Obviously, by year 3/4 when comp was mostly/all RSUs, the stock could have gone up or down significantly. Given that the year 1 cash could be used to buy stock if I really wanted, it didn't seem an unreasonable approach to comp to m…

I definitely know some people on the 10/10/40/40 Amazon comp plan... also seems to be a common tactic to PIP people just before year 3 vests.

Fuck Amazon. I'll never work for them.

Re: Golden Handcuffs

#79

Post by akarma »

joshuamorton wrote: post #61
akarma wrote: post #14

Earlier quoted context omitted.

If you're ambitious, this doesn't hurt your ability to join Coinbase and grow quickly, which is an important factor in the tech industry and its appeal of opportunity. A union would. This offers a more level playing field for employees to begin their time at the company without stringent rules around who can get promoted and when and other red tape. Seems like a great decision.

> A union would. This claim is disputed by, like, many unions. Tenure based promotions/compensation is one, but certainly not the only approach that unions use.

Nearly every major union I've seen supports seniority-based promotions.

I imagine that this is not popular with many employees, and so it cannot be a part of their initial pitch — as you said, not the only approach unions use.

If established unions support seniority-based promotions but nascent ones don't publicly support them, it would follow that they must develop into supporting seniority-based promotions. This is possibly one of those issues where a union gets power and then takes overarching, unpopular measures that rid the company of anyone who wants to work harder and be promoted faster.

If you have evidence that unions don't support seniority-based promotions, I would love to see it! I haven't had a chance to gather data, so I'm only speaking anecdotally.

Re: Golden Handcuffs

#80

Post by TulliusCicero »

I don't see how 4-year stock grants that steadily vests are golden handcuffs at all, since if you switch to a similar company they'll just give you a new stock grant that also steadily vests.

The only part that's like golden handcuffs is the 1-year cliff that's standard, but 1 year ain't bad.

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