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The GitLab exec team is probably pretty happy to be reading this blog post. Because Patricio isn't exercising his stock options they will return to the option p

by calcsam 10y ago

The GitLab exec team is probably pretty happy to be reading this blog post. Because Patricio isn't exercising his stock options they will return to the option pool, where they are available for re-allocation to new hires. 0.1% of a Series B company is the entire four-year grant for a new engineer, or several sales / operations folks.

KingMob 10y ago
Except that the negative PR from the post may well deter qualified applicants in the future, which could easily be worth more than <.1% of the company.
- praneshp 10y ago
  They counter that with their openness, remote-only propaganda on HN and other places.
  - educar 10y ago
    So every time a gitlab openness post comes up, you can be sure this link will be pasted here.
vladimirralev 10y ago
I doubt it. The guy got screwed over big time and he doesn't even fully realize it. Apparently he was working against himself for more than a year. They delayed the grant and the vesting date. Perhaps even gave him strike price with his own projected value calculated in the strike price. The whole point of the stock options is to get a strike price without your own value in there. Also it's likely there was dilution so the numbers don't add up like people say, hard to hire 150 people and take 20M without dilution. If that's the case you need 10 lawyers to watch your back working with gitlab.
- smm2000 10y ago
  He was not screwed. He was contractor and contractors typically do not get any options at all. After one year, GitLab offered him options as an incentive or bonus with standard four year vesting - similar to how big companies award you stock options/RSUs annually.
  - vladimirralev 10y ago
    Well, he is under the impression he was a 9th employee and the grant was delayed. So if this is a bonus for time served then it wasn't made clear to him what's his standing. It doesn't even make sense to award options at that point unless they are backdated maybe [1]. And I am willing to bet money that the nature of the options was misrepresented. Foreign contractors are particularly vulnerable since they wouldn't have experience with US law and finance. I don't know of any companies that award options yearly/bonus, it would be an incredibly stupid thing to do, must always do RSUs [1]. Options may be adjusted for dilution or promotions yearly, but that's different. Options are designed as a tool to get a % proportional to what you add as value. If you get options with your own work valued in the strike price, those options are orders of magnitude less valuable than the options you get at sign up. If gitlab made that clear and he agreed, then I agree gitlab are in the right, otherwise yes he got screwed over big time. [1] The problem with delayed or yearly options grants is that workers have a huge incentive now to lower the strike price for the next valuation. Why would you work hard against yourself if you are really just increasing the price you buy at? You'd be much better off to work against the company at this point and score a lower strike price. Further how can you trust a company that makes you work against your own interest. Perfect example of lose-lose.
icedchai 10y ago
Is that really the average grant for a post series B company? It seems pitifully low.

by calcsam 10y ago

KingMob 10y ago

Except that the negative PR from the post may well deter qualified applicants in the future, which could easily be worth more than <.1% of the company.

praneshp 10y ago
They counter that with their openness, remote-only propaganda on HN and other places.
- educar 10y ago
  So every time a gitlab openness post comes up, you can be sure this link will be pasted here.

vladimirralev 10y ago

I doubt it. The guy got screwed over big time and he doesn't even fully realize it. Apparently he was working against himself for more than a year. They delayed the grant and the vesting date. Perhaps even gave him strike price with his own projected value calculated in the strike price. The whole point of the stock options is to get a strike price without your own value in there. Also it's likely there was dilution so the numbers don't add up like people say, hard to hire 150 people and take 20M without dilution. If that's the case you need 10 lawyers to watch your back working with gitlab.

smm2000 10y ago
He was not screwed. He was contractor and contractors typically do not get any options at all. After one year, GitLab offered him options as an incentive or bonus with standard four year vesting - similar to how big companies award you stock options/RSUs annually.
- vladimirralev 10y ago
  Well, he is under the impression he was a 9th employee and the grant was delayed. So if this is a bonus for time served then it wasn't made clear to him what's his standing. It doesn't even make sense to award options at that point unless they are backdated maybe [1]. And I am willing to bet money that the nature of the options was misrepresented. Foreign contractors are particularly vulnerable since they wouldn't have experience with US law and finance. I don't know of any companies that award options yearly/bonus, it would be an incredibly stupid thing to do, must always do RSUs [1]. Options may be adjusted for dilution or promotions yearly, but that's different. Options are designed as a tool to get a % proportional to what you add as value. If you get options with your own work valued in the strike price, those options are orders of magnitude less valuable than the options you get at sign up. If gitlab made that clear and he agreed, then I agree gitlab are in the right, otherwise yes he got screwed over big time. [1] The problem with delayed or yearly options grants is that workers have a huge incentive now to lower the strike price for the next valuation. Why would you work hard against yourself if you are really just increasing the price you buy at? You'd be much better off to work against the company at this point and score a lower strike price. Further how can you trust a company that makes you work against your own interest. Perfect example of lose-lose.

icedchai 10y ago

Is that really the average grant for a post series B company? It seems pitifully low.