4 ms·

I've been in the room where the CEO said, in not so many words, "fuck the former employees who exercised their options. They aren't here." No one gives a shit.

I've been in the room where the CEO said, in not so many words, "fuck the former employees who exercised their options. They aren't here." No one gives a shit. Sometimes it works out well. You also won't be told when they take on a funding round with priority, even though all their prior rounds were funding with no priority. Personally experienced that one. If the industry wants employees to value their options above zero, give the employees legal protection that would enable them to do so. Otherwise it's VC firms getting butthurt that people aren't accepting their scrip as real money.

argonaut 10y ago
You won't be told about funding rounds if your contract doesn't mention it. Like I said, any details you desire should go in the contract.
- danielweber 10y ago
  Yes, the standard contract is completely opaque to the employee, and they don't have the specialized knowledge required to understand it. And the company sure isn't going to help you. So value the funny-money at 0. If the industry wants to change this perception, then there should be a widespread standardization on a contract that is fair to the employees and it should be easy for employees to understand any diffs from that standard.
  - argonaut 10y ago
    If a contract is opaque to you, you get a lawyer to look it over. End of story. If you sign a contract that is opaque to you, without talking to a lawyer or at least someone knowledgeable (e.g. personal friends that are senior engineers that have talked to lawyers), you only have yourself to blame, not Silicon Valley. It goes without saying that I've rarely found the contracts I've signed to be opaque.
    - wpietri 10y ago
      I find this sort of burden-shifting abhorrent. It's the company who will spend thousand or tens of thousands of dollars having the contract made. It's the company who gets to amortize the costs of a complicated contract over many hiring interactions. It's the company who has the advantage of a strong information and experience asymmetry. In short, the company has a lot more power. If somebody with power screws somebody without, I save most of my blame for the people who set things up.
      - argonaut 10y ago
        Sure. But none of your perfectly valid comment changes the fact that if you are clueless about a contract, you should either talk to a lawyer (or otherwise someone knowledgeable) or decline to sign it. It goes without saying that employment contracts all use the same language, I have never personally run into a clause I found opaque or confusing.
        danielweber 10y ago
        You are making the argument that whatever the company does is legal. That's fine and I don't disagree with it. It's not just a matter of not understanding the entire legal contract. Someone could understand every single thing, but not realize, like you said above, "you won't be told about funding rounds if your contract doesn't mention it." They wouldn't even think about that because they aren't experts in that field. I've negotiated plenty of employment and IP agreements. I've found 100% willingness to, at the least, discuss them. But employee options grants must often be the same for everybody. And for a normal employee (as opposed to some C-level executive hire), once you start negotiating "in case I leave early I want more rights" you are signaling bad things. Really, all I'm telling people is "if you don't understand something fully, assume it's worthless." Your reaction is that, for some reason, employees should jump into the deep end of the pool and try to outsmart the VCs at the game they play every single day of their lives. And for what purpose? The vast majority of the time the options are going to end up at $0 anyway. I say no. Assume legalese is written in order to screw you over. Smile and accept the options because you might get lucky, but never ever stay late at the office imagining how they will make you rich.

argonaut 10y ago

You won't be told about funding rounds if your contract doesn't mention it. Like I said, any details you desire should go in the contract.

danielweber 10y ago
Yes, the standard contract is completely opaque to the employee, and they don't have the specialized knowledge required to understand it. And the company sure isn't going to help you. So value the funny-money at 0. If the industry wants to change this perception, then there should be a widespread standardization on a contract that is fair to the employees and it should be easy for employees to understand any diffs from that standard.
- argonaut 10y ago
  If a contract is opaque to you, you get a lawyer to look it over. End of story. If you sign a contract that is opaque to you, without talking to a lawyer or at least someone knowledgeable (e.g. personal friends that are senior engineers that have talked to lawyers), you only have yourself to blame, not Silicon Valley. It goes without saying that I've rarely found the contracts I've signed to be opaque.
  - wpietri 10y ago
    I find this sort of burden-shifting abhorrent. It's the company who will spend thousand or tens of thousands of dollars having the contract made. It's the company who gets to amortize the costs of a complicated contract over many hiring interactions. It's the company who has the advantage of a strong information and experience asymmetry. In short, the company has a lot more power. If somebody with power screws somebody without, I save most of my blame for the people who set things up.
    - argonaut 10y ago
      Sure. But none of your perfectly valid comment changes the fact that if you are clueless about a contract, you should either talk to a lawyer (or otherwise someone knowledgeable) or decline to sign it. It goes without saying that employment contracts all use the same language, I have never personally run into a clause I found opaque or confusing.
      - danielweber 10y ago
        You are making the argument that whatever the company does is legal. That's fine and I don't disagree with it. It's not just a matter of not understanding the entire legal contract. Someone could understand every single thing, but not realize, like you said above, "you won't be told about funding rounds if your contract doesn't mention it." They wouldn't even think about that because they aren't experts in that field. I've negotiated plenty of employment and IP agreements. I've found 100% willingness to, at the least, discuss them. But employee options grants must often be the same for everybody. And for a normal employee (as opposed to some C-level executive hire), once you start negotiating "in case I leave early I want more rights" you are signaling bad things. Really, all I'm telling people is "if you don't understand something fully, assume it's worthless." Your reaction is that, for some reason, employees should jump into the deep end of the pool and try to outsmart the VCs at the game they play every single day of their lives. And for what purpose? The vast majority of the time the options are going to end up at $0 anyway. I say no. Assume legalese is written in order to screw you over. Smile and accept the options because you might get lucky, but never ever stay late at the office imagining how they will make you rich.