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If you like lower risk and lower gain, sure. The most important thing is being educated. Every time this topic comes up on HN it appears that many people are u

If you like lower risk and lower gain, sure. The most important thing is being educated. Every time this topic comes up on HN it appears that many people are unaware that liquidation preferences are a thing and many sales that are down-rounds have no money falling on common.

xchaotic 8y ago
If it really was lower gain then sure. But as it is, on average, startups give you more chance of ending up with nothing but an entry in a CV.
- greglindahl 8y ago
  If you're only interested in the average, then you should definitely value startup options at zero. Not everyone thinks that way, but you certainly have a valid opinion.
nraynaud 8y ago
employee stocks are engineered to be lower gain (impossible to sell, liquidation preferences etc.), take the cash and use it to take some risk you can control. You like risk? take the money and go to Las Vegas.
hn_throwaway_99 8y ago
> If you like lower risk and lower gain, sure. Given how much the big tech companies are paying though, especially when it comes to RSUs, I'm not sure this calculus makes sense anymore, especially for early employees. Founders may do exceptionally well on many cases, but for most early employees at startups there really isn't that much potential upside in most cases, compared to the guaranteed earnings you can get at a top tech company.
- Gibbon1 8y ago
  My take is over the last 30 years the return for early employees has become progressively worse. To the point where the best case scenario you only break even vs a traditional job.
- Bahamut 8y ago
  Yeah, there's ample evidence that it's almost all no gain on the startup exit side, unless you got very lucky and worked for the right company. I can confirm that RSU payouts at the giants far dwarf what you can get at almost all startups. The total comp difference is insane.
olliej 8y ago
Just to clarify: how educated do you need to be? Founders don’t appear to be obligated to tell you when they make deals that effect you, and more importantly retroactively reduce how much they paid you. If you are paid in stock, and the founders make a deal that reduces the payout value of that stock (in this case to zero) they have stolen from you in a way that has no recourse. Literally they paid you with something that was presumably claimed to have value, and then after a few years made deals that made that worth less. Even though you had already been “paid”. How much education can you do that would protect you from this?
- greglindahl 8y ago
  Given the 8 comments you've made so far in this discussion, I'd say that my two education suggestions are spot-on.

xchaotic 8y ago

If it really was lower gain then sure. But as it is, on average, startups give you more chance of ending up with nothing but an entry in a CV.

greglindahl 8y ago
If you're only interested in the average, then you should definitely value startup options at zero. Not everyone thinks that way, but you certainly have a valid opinion.

nraynaud 8y ago

employee stocks are engineered to be lower gain (impossible to sell, liquidation preferences etc.), take the cash and use it to take some risk you can control. You like risk? take the money and go to Las Vegas.

hn_throwaway_99 8y ago

> If you like lower risk and lower gain, sure. Given how much the big tech companies are paying though, especially when it comes to RSUs, I'm not sure this calculus makes sense anymore, especially for early employees. Founders may do exceptionally well on many cases, but for most early employees at startups there really isn't that much potential upside in most cases, compared to the guaranteed earnings you can get at a top tech company.

Gibbon1 8y ago
My take is over the last 30 years the return for early employees has become progressively worse. To the point where the best case scenario you only break even vs a traditional job.
Bahamut 8y ago
Yeah, there's ample evidence that it's almost all no gain on the startup exit side, unless you got very lucky and worked for the right company. I can confirm that RSU payouts at the giants far dwarf what you can get at almost all startups. The total comp difference is insane.

olliej 8y ago

Just to clarify: how educated do you need to be? Founders don’t appear to be obligated to tell you when they make deals that effect you, and more importantly retroactively reduce how much they paid you. If you are paid in stock, and the founders make a deal that reduces the payout value of that stock (in this case to zero) they have stolen from you in a way that has no recourse. Literally they paid you with something that was presumably claimed to have value, and then after a few years made deals that made that worth less. Even though you had already been “paid”. How much education can you do that would protect you from this?

greglindahl 8y ago
Given the 8 comments you've made so far in this discussion, I'd say that my two education suggestions are spot-on.