91–100 of 334 posts
This might be the one case where I personally would accept the business failing is a better outcome.
I am currently working with a start-up where the company is incapable of meeting its capex obligations. The founder raised a good amount of capital from investors a few years ago, and that provided a decent runway, but there's no traction, no KPIs, and whilst we've built some impressive technology, impressive technology does not bring in revenue. One of the problems (amongst many) is that the primary stakeholder has…
I have a friend that has given up on options. Even if he were to be #10 somewhere he would take any extra pay over any options. Stories like this show the wisdom of that. Are there really that many success stories for people other than for VCs and (maybe) founders out there anymore? Even if your options (eventually) get you 200k, how much did they cost you in years of lower pay. Even with a payout, considering intere…
> Are there really that many success stories for people other than for VCs and (maybe) founders out there anymore? I was the employee around #300 at Atlassian, the founders didn’t dilute the employees, and my options netted $3m (minus the taxes) after working there for 3 years and waiting 6 years. Scott Farquhar and Mike Cannon-Brookes were hell-bent on being honest, fair and giving back. There are good people out th…
I am currently working with a start-up where the company is incapable of meeting its capex obligations. The founder raised a good amount of capital from investors a few years ago, and that provided a decent runway, but there's no traction, no KPIs, and whilst we've built some impressive technology, impressive technology does not bring in revenue. One of the problems (amongst many) is that the primary stakeholder has…
Leave my dude. You'll be better off
Had a one hour casual chat with a start-up game studio in early February, and the offer came through in email on Friday for significantly more money and an interesting problem.
Had a one hour on-site casual chat with an established robotics company today, that stretched out in to about five hours of casually meeting the team, grabbing coffee with the CEO and CTO and a verbal offer at the end of the day. It is for more money than my current position, but it isn't significantly more money.
I have some thinking to do over the next couple of days. Plus a few more casual chats with companies lined up. Not sure if I should pump the brakes until Game Developers Conference though and see if there is anything there that's interesting. Work tends to fall out of the trees at that place if you shake the trunk hard enough.
Earlier quoted context omitted.
It's not just your friend: a lot of people have given up on options. Obviously they're underrepresented here on HN because this is a startup-focused forum, but I know many, many people who have concluded "options have an EV of zero, startups pay options in lieu of market-rate salary, therefore startups are a raw deal; I will only go to FAANGs". They're sort of a dark matter universe since they are only visible in the…
I guess this is why worker-coop would never really take off. Most people are not in position to be paid in possible future profit rather than direct compensation. There's also nothing stopping employees at a public company to convert their entire salary into stock but not many do that either.
If I sell my company for $1T, but I financed $999B of it, should I expect to get a payout? Financing generally requires interest. Seems like the headline is trying to invoke outrage.
I am currently working with a start-up where the company is incapable of meeting its capex obligations. The founder raised a good amount of capital from investors a few years ago, and that provided a decent runway, but there's no traction, no KPIs, and whilst we've built some impressive technology, impressive technology does not bring in revenue. One of the problems (amongst many) is that the primary stakeholder has…
I think you're in a same-same path with this. That is, If you say "No, I don't want equity", they still owe your back pay, there are multiple ways to get it, AND if either "back pay" or "equity" is to have value, they must have more funding. Which means, out of that funding can immediately come your back pay. So if you take the equity, or insist on pay, both are the same in the end. In fact, by not showing you what y…
Only after the taxman came over. And in most places the banks are preferred too.
In my case you are only first in line if you have a court order for them to pay (give them notice to pay, repeat three times, go to court). Otherwise you are above the shareholders only but it's not that hard to work around that so I have been told.
This is happening more now. Liquidation preference was included in 20% of all Series B-E Silicon Valley venture financings in Q3 last year. When a company is not doing well and there are no other investors who will finance the next stage of the company, investors have the leverage and can include a liq pref and drag along to force other shareholders to sell. https://assets.fenwick.com/banner-images/Silicon-Valley-Ven…
Great document, but I could not find any mention of "drag along".
For the drag I was just referencing the original article in this thread. Both liq pref and drag are such onerous terms that the only way investors can get them is when the company has lost their leverage by not having other interested investors.
I’d like to challenge this notion. Risk comes from one factor and one factor only: how much skin do you have in the game?
Skin isn’t money. Skin is how much are you in for. How much would this hurt if you lost.
The ultra rich, when investing, have actually very little skin in the game. A million here, a million there. What’s the difference? They’ll still be impossibly wealthy even if everything goes tits up.
Those folks should not make the big bucks in a deal. They haven’t risked anything, even some notion that they “risked” investing their money in this vs that: they picked the winner in this case.
It’s fanciful thinking I know, but I see it as _the primary_ problem with either capitalism, or ultra wealth. The system favors people with the most money, and the people with the most money control the system.
I am currently working with a start-up where the company is incapable of meeting its capex obligations. The founder raised a good amount of capital from investors a few years ago, and that provided a decent runway, but there's no traction, no KPIs, and whilst we've built some impressive technology, impressive technology does not bring in revenue. One of the problems (amongst many) is that the primary stakeholder has…
I think you're in a same-same path with this. That is, If you say "No, I don't want equity", they still owe your back pay, there are multiple ways to get it, AND if either "back pay" or "equity" is to have value, they must have more funding. Which means, out of that funding can immediately come your back pay. So if you take the equity, or insist on pay, both are the same in the end. In fact, by not showing you what y…
Well, no. As you write yourself, if you insist on pay, and they cannot get funded and have to wind down, you're first in the line. You may not get a large percentage of what's owed, but you'll get something. And if they can get funded, you almost certainly can get everything owed.
If you take equity and they cannot get funded, you get nothing. If they can get funded, the way they avoid showing the terms, it's extremely likely there are the kind of shenanigans TFA describes and you'll get nothing.
Really, the only scenario where taking the equity makes sense is if you believe the company will do well and the funding terms will be be favorable or at least balanced. And it sure doesn't look like that.