"> Tech employees need to wake up about common vs preferred shares" The important distinction is employee vs founder. You mention founders in your comment. Fo

"> Tech employees need to wake up about common vs preferred shares" The important distinction is employee vs founder. You mention founders in your comment. Founders typically would hold a double-digit percentage of common shares. Employees that might get offered 0.1% if they are an early hire, or less assuming later stage (discounting exec hires here, because the OP of this thread was about engineers). Founders also typically got their common shares at a very low valuation - let's say they were issued pre-money, then their value to the tax man might be $200K (of a 2M pre-money valuation), but with a vesting schedule that makes them tax efficient. Employees typically get their common shares at a higher valuation, post money, with a 200M valuation. Their 0.1% is also worth $200K to the tax man. See how this is different?