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Would you estimate the percentage of Web 2.0 Silicon Valley engineers that have been able to cash out anything significant (let's say > 1 year market salary) at

by guelo 10y ago

Would you estimate the percentage of Web 2.0 Silicon Valley engineers that have been able to cash out anything significant (let's say > 1 year market salary) at greater than .1%?

argonaut 10y ago
Yes, because you are ignoring the fact that most engineers that make money off stock options are doing so at well-established startups that haven't gone IPO yet. Companies like Airbnb, etc. 4 years ago, everyone knew Airbnb, Pinterest, etc., would be successful.
- aaronbrethorst 10y ago
  Kind of like how everyone knew Evernote would be successful four years ago? Or Gilt? Or Dropbox? Or Fab? Or Foursquare?
  - argonaut 10y ago
    The only companies whose options are worth 0 (zero) in your example are Gilt and Fab. Evernote and Foursquare are still around - your options are worth less than their private valuations if you joined 4 years ago, but they are not worth 0, even after dilution. Foursquare is still a $650M company. And only in some twisted world is Dropbox not a success. They're a friggin multi-billion dollar company even if they aren't a 50 billion dollar company (the horror). I also didn't say you're going to have a 100% stock option hit rate for companies that are pre-IPO. You are still taking on risk. But your hit rate is going to be a lot higher. It's also rather telling that these are among the worst examples of pre-IPO tech companies you can think of.
    - aaronbrethorst 10y ago
      > It's also rather telling that these are among the worst examples of pre-IPO tech companies you can think of. Nah, just the first ones that came to mind. Theranos is another good one I should've mentioned.
      - argonaut 10y ago
        Theranos was never in the category of going-to-IPO-soon.
        aaronbrethorst 10y ago
        Arguably, neither were any of the others; none of them ever published an S-1.
rconti 10y ago
Yes. I'd say easily 3-5%.
- ryandrake 10y ago
  Quite honestly that would shock me, but I wouldn't know where to get data about this. I always believed that only a microscopic fraction of tech workers actually made off with more than a year or so of salary from options (but those who did likely made out extraordinarily well). I would not expect a very flat distribution.
  - argonaut 10y ago
    Every time any tech company goes IPO or gets acquired for a large number (~>$50M), that's on average 1,000+ engineers who probably made some amount of money from options.
    - chasing 10y ago
      These numbers don't make sense to me. You're saying an average tech company that exits has over 1000 engineers alone? Certainly a $50M company can't support 1000 engineers. Or a $100M one. (And, just for fun, if a co exited at $1B with 1000 engineers... Let's use round numbers to sketch it out. Let's say the engineers alone get 10% of that value (which seems generous). That's $100M. Divided amongst 1000. So $100K. Not that much if you've given up income for years! Even if that amount is split across 100 engineers, $1M's not necessarily a super-duper return on investment if you're taking a bit pay hit.)
      - argonaut 10y ago
        I'm saying the average number of engineers is pretty high (because it's an average, it's skewed up). Regardless, quibbling over this doesn't really detract from my broader point which is that every time you see a company go public, that's hundreds, if not thousands, of engineers that made some money off their options. Some got rich. Most probably just ended up with an above-market salary. Others (those who just joined) get a tiny amount. The same applies for acquisitions, though obviously you'll need to scale the number up or down depending on the $$.

by guelo 10y ago

Would you estimate the percentage of Web 2.0 Silicon Valley engineers that have been able to cash out anything significant (let's say > 1 year market salary) at greater than .1%?

argonaut 10y ago

Yes, because you are ignoring the fact that most engineers that make money off stock options are doing so at well-established startups that haven't gone IPO yet. Companies like Airbnb, etc. 4 years ago, everyone knew Airbnb, Pinterest, etc., would be successful.

aaronbrethorst 10y ago
Kind of like how everyone knew Evernote would be successful four years ago? Or Gilt? Or Dropbox? Or Fab? Or Foursquare?
- argonaut 10y ago
  The only companies whose options are worth 0 (zero) in your example are Gilt and Fab. Evernote and Foursquare are still around - your options are worth less than their private valuations if you joined 4 years ago, but they are not worth 0, even after dilution. Foursquare is still a $650M company. And only in some twisted world is Dropbox not a success. They're a friggin multi-billion dollar company even if they aren't a 50 billion dollar company (the horror). I also didn't say you're going to have a 100% stock option hit rate for companies that are pre-IPO. You are still taking on risk. But your hit rate is going to be a lot higher. It's also rather telling that these are among the worst examples of pre-IPO tech companies you can think of.
  - aaronbrethorst 10y ago
    > It's also rather telling that these are among the worst examples of pre-IPO tech companies you can think of. Nah, just the first ones that came to mind. Theranos is another good one I should've mentioned.
    - argonaut 10y ago
      Theranos was never in the category of going-to-IPO-soon.
      - aaronbrethorst 10y ago
        Arguably, neither were any of the others; none of them ever published an S-1.

rconti 10y ago

Yes. I'd say easily 3-5%.

ryandrake 10y ago
Quite honestly that would shock me, but I wouldn't know where to get data about this. I always believed that only a microscopic fraction of tech workers actually made off with more than a year or so of salary from options (but those who did likely made out extraordinarily well). I would not expect a very flat distribution.
- argonaut 10y ago
  Every time any tech company goes IPO or gets acquired for a large number (~>$50M), that's on average 1,000+ engineers who probably made some amount of money from options.
  - chasing 10y ago
    These numbers don't make sense to me. You're saying an average tech company that exits has over 1000 engineers alone? Certainly a $50M company can't support 1000 engineers. Or a $100M one. (And, just for fun, if a co exited at $1B with 1000 engineers... Let's use round numbers to sketch it out. Let's say the engineers alone get 10% of that value (which seems generous). That's $100M. Divided amongst 1000. So $100K. Not that much if you've given up income for years! Even if that amount is split across 100 engineers, $1M's not necessarily a super-duper return on investment if you're taking a bit pay hit.)
    - argonaut 10y ago
      I'm saying the average number of engineers is pretty high (because it's an average, it's skewed up). Regardless, quibbling over this doesn't really detract from my broader point which is that every time you see a company go public, that's hundreds, if not thousands, of engineers that made some money off their options. Some got rich. Most probably just ended up with an above-market salary. Others (those who just joined) get a tiny amount. The same applies for acquisitions, though obviously you'll need to scale the number up or down depending on the $$.