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I'd argue that working at crappy companies is the problem and stock comp pain is just one symptom -- I find various forms of crappiness tend to correlate. At p

I'd argue that working at crappy companies is the problem and stock comp pain is just one symptom -- I find various forms of crappiness tend to correlate. At places with solid cultural values (Pinterest, Dropbox, Asana, Coinbase to name drop a few), employees are treating reasonably fairly on all dimensions. There's just a few ground rules: 1. Is the company giving options? They better have a 7 year exercise window (https://triplebyte.com/blog/fixing-the-inequity-of-startup-equity https://triplebyte.com/blog/fixing-the-inequity-of-startup-e... ); if not, don't work there. 2. Is the company giving RSUs? Great; just realize you'll be paying nearly 50% taxes when they convert to shares. (and make sure that the company will actually pay your taxes by buying back shares when they do convert!) 3. Is the company super early stage? Your options are probably worth nothing and probably will amount to nothing. But if it costs almost nothing to exercise (strike + taxes), you might as exercise them now.

erentz 9y ago
Why do you say 50% taxes on RSUs? You pay tax on them as normal income for their equivalent cash value at vesting. If you want to immediately sell you can. RSUs suck only when the company has one year vesting schedules. Quarterly or monthly vesting schedules work fine by me.
- usaar333 9y ago
  I was unclear in my post and sadly the edit timeout has passed. You pay taxes on RSUs not at vesting, but when they settle into shares. This might be shortly after vesting; it might be delayed until an acquisition/IPO. (generally it is delayed for companies far away from IPO). The delay causes multi-year income to be batched into a single year. With a progressive tax system, that results in your money being taxed at a rather high marginal tax rate: If you have a substantial amount you vest a year, it's easiest to use the highest marginal bracket as a conservative guess of what you'll be taking home. In California, that's somewhere on the order of 48% combined state + federal.
jondubois 9y ago
That's true. I find that founders of companies that try to screw over their employees with crappy equity schemes are usually in it for the short-term gain; that means that the company is more likely to crash at some point in the future once the founders are all cashed up.

erentz 9y ago

Why do you say 50% taxes on RSUs? You pay tax on them as normal income for their equivalent cash value at vesting. If you want to immediately sell you can. RSUs suck only when the company has one year vesting schedules. Quarterly or monthly vesting schedules work fine by me.

usaar333 9y ago
I was unclear in my post and sadly the edit timeout has passed. You pay taxes on RSUs not at vesting, but when they settle into shares. This might be shortly after vesting; it might be delayed until an acquisition/IPO. (generally it is delayed for companies far away from IPO). The delay causes multi-year income to be batched into a single year. With a progressive tax system, that results in your money being taxed at a rather high marginal tax rate: If you have a substantial amount you vest a year, it's easiest to use the highest marginal bracket as a conservative guess of what you'll be taking home. In California, that's somewhere on the order of 48% combined state + federal.

jondubois 9y ago

That's true. I find that founders of companies that try to screw over their employees with crappy equity schemes are usually in it for the short-term gain; that means that the company is more likely to crash at some point in the future once the founders are all cashed up.