Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Startup CEOs who gave up fortunes to turn employees into millionaires

businessinsider.com

Post reply on HN
Print view View original

91–100 of 142 posts

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#91

Post by trevelyan »

vinceguidry wrote: post #4
erobbins wrote: post #3

It's sad that this behavior is unusual enough to be noteworthy.

This comment reads as entitled to me. Startup founders have an insane number of things on their plate, and that list just keeps growing and growing. Startup employees work hard, but the founders still bear most of the risk and responsibility. What really needs to happen is for new ways to organize startups to distribute the risks and responsibilities better, so that it's not up to the goodness of the founder's heart…

Why is this post downvoted to grey? It is not offensive and states something with which many founders will agree. Just to chip in a personal anecdote, I tried giving away equity to employees twice as part of a package, and it didn't work out either time. I do not blame the other parties , but parent poster's comments on the risk-averse nature of most workers are not wrong. Most people want cash, and it is your responsibility as an employer to pay them regardless of whether you make money.

Anyone who believes the HN community is biased towards founders can see evidence here to the contrary.

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#92

Post by RogerL »

twelvechairs wrote: post #88
cjslep wrote: post #52

Earlier quoted context omitted.

I believe it was Steve Kent's The Ultimate History of Video Games Atari portion that really fleshes out Steve Jobs. The two anecdotes I remember are: 1. People in Atari generally considering him an oderous hairy hippie who once disappeared from work to go to India for self-enlightenment, but returned with Hepatitis. 2. He (Steve) was once offered $100 per transistor he could eliminate below the 100-transistor mark fo…

> oderous I assume you mean odious not odorous? (P.s. Shakespeare made this pun in 'comparisons are odorous')

He was infamous for not bathing, and hence bad body order.

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#93

Post by [deleted] »

emmett wrote: post #87
timr wrote: post #79

Earlier quoted context omitted.

"you know, we would need to exit for a billion dollars for me to receive a million?" It's worse than that. By the time you factor in preferred shares and other investment dilution, your 0.1% will be more like 0.00001%[+]. Few people think about that, and unless someone is actively looking out for your interests (e.g. someone giving retention grants -- or you demanding them), it's difficult to make a lot of money as a…

That's a gross exaggeration. If you own 0.1% of the company, you're likely to be diluted to around 0.02% at the very worst, and most likely 0.04% or so assuming 3 rounds of funding. That's assuming a positive outcome that clears preferences of course - if the company goes in a fire sale you're not going to make anything at all. But assuming a billion dollar exit means you're assuming not a fire sale.

[deleted]

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#94

Post by porter »

emmett wrote: post #87
timr wrote: post #79

Earlier quoted context omitted.

"you know, we would need to exit for a billion dollars for me to receive a million?" It's worse than that. By the time you factor in preferred shares and other investment dilution, your 0.1% will be more like 0.00001%[+]. Few people think about that, and unless someone is actively looking out for your interests (e.g. someone giving retention grants -- or you demanding them), it's difficult to make a lot of money as a…

That's a gross exaggeration. If you own 0.1% of the company, you're likely to be diluted to around 0.02% at the very worst, and most likely 0.04% or so assuming 3 rounds of funding. That's assuming a positive outcome that clears preferences of course - if the company goes in a fire sale you're not going to make anything at all. But assuming a billion dollar exit means you're assuming not a fire sale.

Is 0.1% realistic (or average) for an employee? What are typical equity ranges for employees?

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#95

Post by seivan »

sharkweek wrote: post #50
apalmer wrote: post #46

I dont think startup CEOs have any requirement to do this type of thing. On the other hand I think there is a powerful reality distortion field around start ups. Its literally more work than at bigco, for about 70% of the salary, for a lotto ticket that has a 1 in 1000 chance of pay off, and the jackpot payoff is something like 50K-100K. Really Really doesnt make sense unless you enjoy the atmosphere you are not goin…

Good points, but one thing to keep in mind - a lot of people just enjoy working at smaller companies. I did some time at a large financial institution making great money, but absolutely hated how empty it all felt. Nothing got done, nothing changed, nobody listened to me. I work at a much smaller company now, and almost everything I do on a daily basis has a measurable impact. I can literally watch the things me and…

This would be the main attraction for me as well. What kills me at larger places (and even smaller soul-less companies) is the amount of dead weight and inefficiency.

Bullshit work created by people with bullshit titles for bullshit reasons.

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#96

Post by JohnTHaller »

emmett wrote: post #87
timr wrote: post #79

Earlier quoted context omitted.

"you know, we would need to exit for a billion dollars for me to receive a million?" It's worse than that. By the time you factor in preferred shares and other investment dilution, your 0.1% will be more like 0.00001%[+]. Few people think about that, and unless someone is actively looking out for your interests (e.g. someone giving retention grants -- or you demanding them), it's difficult to make a lot of money as a…

That's a gross exaggeration. If you own 0.1% of the company, you're likely to be diluted to around 0.02% at the very worst, and most likely 0.04% or so assuming 3 rounds of funding. That's assuming a positive outcome that clears preferences of course - if the company goes in a fire sale you're not going to make anything at all. But assuming a billion dollar exit means you're assuming not a fire sale.

So, if we take the above poster at their word that it would have to be a billion dollar exit to be worth their while (and net them a million dollars for X years at below market salary) and assume your dilution numbers are accurate, they'd only get 200 to 400k. There would have to be a 2.5 to 5 billion dollar exit for their diluted tenth of a percent to net them a million.

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#97

Post by joshpadnick »

dsirijus wrote: post #54

Ask HN: So, I'm the sole founder here with investor. The dude's awesome, but the contract we signed puts me in significant financial risk if the company doesn't turn up profitable. I have more than several employees (some of them will probably read this) who I pay regular and competitive money though I'm not particulary pleased with their output (but hey, it's improving, and there's not much of a talent pool here). M…

I can understand a part of your perspective. After all, from an objective point of view you are the one who's ultimately accountable for getting things done. And by that logic, you deserve the lion's share of the rewards when they come due.

But the problem with your reasoning is that, in reality, growing a successful company is a team sport. No matter how brilliant you are, you alone are no match for a high-performing team. Or even a medium-performing team.

The real issue is not what you deserve should the company "turn profitable." It is that you are extremely unlikely to become successful until you figure out how to build a great team. Which is hard, by the way.

My recommendation is that, if you have established product-market fit and are now in execution/scale mode, you need to either step up as CEO and make learning how to build and manage a team to achieve real results your #1 responsibility. Or if that's not your thing, you need to accept your strengths and weaknesses and find someone else who can play that role.

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#98

Post by chc »

soperj wrote: post #44
Arjuna wrote: post #38

Although Woz wasn't a CEO... for those that don't know about this, I thought you would find it interesting [1]: "And when Jobs (in the movie, but really a board does this) denied stock to the early garage team (some not even shown) I'm surprised that they chose not to show me giving about $10M of my own stock to them because it was the right thing. And $10M was a lot in that time." [1] Woz's entire post is on this pa…

I truly hope that Woz is remembered as the guy behind Apple's early greatness and Jobs as just a dickhead who set us all back. Not just developers with his no compete bullshit, but everyone with his stupid no ports aesthetic. How are people supposed to learn to tinker when everything is locked down??

Woz wasn't even there for the time of Apple's greatest success. You don't have to like Jobs, but he did great things even without Woz.

Re: Startup CEOs who gave up fortunes to turn employees into millionaires

#99

Post by thirsday »

modfodder wrote: post #72
dsirijus wrote: post #54

Ask HN: So, I'm the sole founder here with investor. The dude's awesome, but the contract we signed puts me in significant financial risk if the company doesn't turn up profitable. I have more than several employees (some of them will probably read this) who I pay regular and competitive money though I'm not particulary pleased with their output (but hey, it's improving, and there's not much of a talent pool here). M…

Not in the tech industry, but @ 42 I've worked in a lot of industries with a wide range of experience and worked with a lot of entrepreneurs and founders. Without actually knowing you, I can't say what type of person you are. But I can say the type of people I've met who had similar viewpoints were very arrogant and rarely recognized the great contributions of their employees, and often took personal credit for direc…

His twitter certainly isn't doing him any favors as a character reference, either.
Post reply on HN