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Are you guys distinguishing between what the buyer pays and what the engineer gets? To put it another way: if you personally promised the engineer $5 million (
by inputcoffee 10y ago
Are you guys distinguishing between what the buyer pays and what the engineer gets?
To put it another way: if you personally promised the engineer $5 million (vesting over 3 years) they may switch.
This means the buyer must see some value in the company over and above the engineers. (IP? Customers?)
- mljoe 10y agoThe engineers are not getting that obviously, it depends on how much equity they have and the difference between the amount of VC money pumped into a company and the final sale price of the company. VCs often get 2x preferred stock (at the minimum - it entitles them to 2x what they invested). This is before anyone else is allowed to see a dime. Every term sheet is different of course.
- ThrustVectoring 10y agoThe value of the team is also larger than the individual engineers on it. Plus, a package bid is less risky if you're looking to get the entire package. Oh, and poaching has another risk - that you get only the worst employees.