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This is part of what I'm asking. The valuation is growing, as is the amount of money their taking. That means the company now has to exit for that much more in
by cassieramen 10y ago
This is part of what I'm asking. The valuation is growing, as is the amount of money their taking. That means the company now has to exit for that much more in order for employees to see any return. If I'm an early employee I now have to hope they exit for $X billion for my shares to be worth anything. If they exit for less there's a chance I see nothing after investing years of my life and watching them pass on a $3 billion offer.
I hope that's not the case.
- chresko 10y agoThe company doesn't have to exit for billions in order for early employees to make a substantial return. Being employed now is a different scenario, though.
- AndrewKemendo 10y agoThere are other ways of making employees benefit before a liquidity event, but generally what you describe is how all this works, and has worked since the beginning. That's the risk everyone is taking.
- downandout 10y agoMy guess is that with such a massive round, at least some employees were allowed to take some money off the table at this valuation. I'm not sure what their policy is on secondary markets, but employees may be cashing in at the current valuation there as well. If that is the case, those that joined near the time of the $3 billion offer are likely very happy.
- gooserock 10y agoPresumably though, employees also got paid a very, very healthy salary while working there too, so it's far from a complete loss...