6 ms·

WeWork’s 17th employee: I was not offered options

138 points by seapunk 7y ago

eps 7y ago
I understand this person is upset and likely bitter, but claiming that she remained "naive" about options after 4 years in a startup, when they started granting them (tweet #15), looks rather odd to me. There's gotta be more to the story than written.
nolok 7y ago
So she did what every HN thread on the matter says, with good reason : focus on your actual job and salary, not on equity that may or may not have some value some day. Dont get me wrong it appears the reason she ended up with none is not ok, but would that thread have been made if wework had ended up being one of those "failed" startup and those equities never gain any value? Would she have preferred to get equity but a lower salary (either at that moment, or on further yearly negotiation) if wework had ultimately failed? Or if like here she left long before she could use it? Don't think about what could have been with such things, equity as a lowly employee at a tech startup is very much like playing the lottery. If you're not directly invested in it such prefer the hard cash of your salary and don't let survivor bias make you regret that one time things could have been.
- sooheon 7y ago
  I think if the options are clear and up front, with the "exchange rate" between equity and salary laid out, what you said holds true. I think the tweeter is generally dissatisfied with how little transparency there was.
  - nolok 7y ago
    But then the fact that it is equity has no weight what so ever in the story, it works the same with regular salary : ask for what you want, evaluate properly your position and worth, negotiate, change job if you genuinely think you're worth more but he won't agree, and don't let your boss be the one in charge alone of deciding what's fair to say you're worth, not when he has vested interest in that being as small as possible and you in it being as big as possible. Your boss is not on your side during your contract negotiation. Make the story about how they gave automatic raise based on position but she's not in the grid so don't get one and it's even something many have heard. Except maybe she would have reacted and argued more.
- vinceguidry 7y ago
  At the end of the day, the startup world is about creating opportunity where there was none before. It gets nasty, and even nastier when you realize the only personal recourse you will ever have for being in that world and not getting the opportunity despite doing the work is to go make your own opportunity, with even more work. If it's crushing your soul to be there, then you really don't belong. That's the long and the short of it. I personally look at the world of business as a necessary evil, that what makes business evil makes startups especially evil. But no less necessary because of it. I don't think any attempts to make startups less evil will do anything but just make it more evil. The attempts will fool people into believing that evil has been conquered, when it's just been painted over with lip service.
- awinder 7y ago
  I think there’s a genuine problem with the way that compensation has evolved though. This is in the 2nd or 3rd thread tweet, she says perfectly upfront that she was 23 and had no idea. That is far from unique, I talk to all kinds of people commonly who have the same tales of their early career. And I don’t think it’s particularly healthy to have complex compensation structures where workers are unprepared to actually make intentional informed decisions. That is ripe for abuse and deserves some sunshine.
  - goatinaboat 7y ago
    Right. The reason given “you don’t get options because you have a unique job title” is clearly total bullshit to those of us who have been around the block, but being naive she believed it. That’s the issue. Her boss knowingly and deliberately deceived her.
- psadri 7y ago
  If you are joining a startup, you should be there to get equity. This is the main financial reason to join a startup. If you prefer cash, join a established company.
  - deleted 7y ago
    [deleted]
- tmcw 7y ago
  HN threads focus on equity/salary tradeoffs, particularly for people joining a startup. This situation - where nobody was getting a salary 'cut' or negotiating a split, but where a startup was issuing equity to existing employees, is not what HN discusses, and her decision was not the same. Heck, her decision wasn't really a decision because a crummy company made it for her.
lordnacho 7y ago
It's very common for young people to not understand financial matters like options grants. That doesn't mean it's okay to benefit from their ignorance, especially as the company is now making a large number of people very wealthy. IMO it's a matter of doing the decent thing over the legal thing. Certainly if I was making a zillion bucks like the boss of WeWork I would find a way to pay the early employees who missed out.
- em12a8 7y ago
  > It's very common for young people to not understand financial matters like options grants Do you have any recommendations for learning more about that? I recently started working full-time at a tech company and I feel like I also have too little understanding of those things.
  - hartem_ 7y ago
    Venture Deals (by Brad Feld) provides a great overview of startup finance matters. It is intended for founders and covers things other than employee equity. It’s an extremely useful read because it provides a holistic overview of the overall fundraising process and enables one to think about equity in a systematic way.
    - deanalevitt 7y ago
      The new book Secrets of Sand Hill Road by Scott Kupor is slightly newer, a little more readable, and talks a lot about dilution, but otherwise covers almost the same ground. Both books are great in understanding the space and motivations of various players.
      - hartem_ 7y ago
        That’s another great one! I would suggest reading the Venture Deals (which appeared quite practical to me) first and following it up with the Secrets (that’s great for understanding incentive structures and motivations of everyone involved).
doctorpangloss 7y ago
Equity is like a superpower in negotiation with employees. Because it is zero sum among them, it neutralizes collective bargaining—the most effective form of negotiation they have. So it’s not as black and white as, she should have done this or that differently, or someone should have made this or that disclosure or even helped her out. Equity is pretty magical in how it makes people misbehave and turn on each other. And feeling mad that she got a raw deal is the right emotion here.
avip 7y ago
I fail to see her point. There’s always lack of transparency in equity allocation. If there exist a startup with a transparent cap table, that’s surely exceptional.
xenihn 7y ago
>By no means do I feel entitled to equity I think she does come off as entitled. I also think she has every right to feel that way. #17 is really early. I'd go so far as to say she deserved it. It feels like ops people are generally under-appreciated in tech.
dustinmoris 7y ago
Her personal story aside, which I can imagine must feel a bit bitter, I am of the opinion that equity should only ever be given to employees who have a crucial and direct impact on the success of a business. If I join as a COO into an early startup then I take risks, play a crucial role in it's evolution and therefore deserve some equity to incentivise the best performance I can do. However, if I'm an account, even if I'm employee no 2 I would never expect equity. Doing accounts is not crucial and has nothing to do with the actual startup itself. If they pay a normal salary for an accountant then any accountant could just take that job and replace me. Why should the business owners who must have taken huge risks themselves ever give a piece of their hard earned cake to an accountant? Doesn't make sense, they get a fair salary for their work and that is all they deserve. So there's always two sides to everything. Not everyone always deserves what others have. That's a common misconception today where everyone looks for reasons to claim how they've been treated unfairly. EDIT: Before more people jump at my throat, I want to clarify that I am not talking about not compensating employees well because of a stupid reason like they can get replaced or something. That's not at all what I'm saying and I thought that was pretty clear. EVERYONE should get a great salary and great work/life perks, BUT when it comes specifically to giving away OWNERSHIP of one's business, then IMHO just being a great employee is not reason enough. I just don't think that everyone should own some % of a company just for rocking up every day and being nice to their colleagues. That's all.. if you disagree with that, then fair enough, but then say that, and don't try to teach me that people should get compensated well, because I never said otherwise.
- alkonaut 7y ago
  A startup is a huge risk regardless, so if I take a job at at a startup I want to be compensated for the risk. Even if I’m cleaning it fetching coffee. That doesn’t have to be equity but pay needs to be better than if I took the same job at the megacorp across the street, because the risk of suddenly being without a job when the company goes bankrupt is much smaller.
  - heisenbit 7y ago
    If you are paid market rates, your career perspectives in the line of business you are in are typically not stellar and your career prospects improve by working in that company no matter how it does you are not taking a risk.
thinkingkong 7y ago
If its true that everyone else at the company got options but her thats pretty upsetting. If she was reporting directly to the COO and they had a good working relationship then that person should have fought for an exercise grant or eliminated the position.
Proven 7y ago
Didn't he join because he was "passionate about the job"?
huhtenberg 7y ago
The way I read it - she was being not-so-subtly hinted to search for another job. No way in hell the management wouldn't realize how refusing a 4-year old employee any options would look on her end. Zero is zero. It's like leaving a 1c tip at a restaurant. So this was most certainly done on purpose.
- the_gipsy 7y ago
  Or, the way she said it - she was young and ignorant of how options work. And management knew this, tried, and got away with it easily.
  - huhtenberg 7y ago
    Issuing no options to a 4 year old employee can mean exactly one thing - it was not a very valuable employee that they weren't keen on retaining. That's about it.
    - prepend 7y ago
      I don’t know what an “Operations Associate” is but having a junior person report directly to the COO seems like a really junior admin/help with everything/type. It’s weird that the COO wouldn’t give options to her admin, I think. It could also be OP overestimating her value. When I was starting out I thought that working super hard and helping everywhere was the most important thing in the world to me. It took me a while to figure out how value is created for organizations.
      - goatinaboat 7y ago
        Microsoft and Apple made all their early secretaries rich.
        dexterdog 7y ago
        Not the ones that quit when the companies were a just few years old.
nextstep 7y ago
Well, pessimistically it might not matter much either way. The employees with stock currently will likely be subject to a six month lock-up period after the IPO date. And it’s quite likely that the house of cards that is WeWork won’t survive that much scrutiny as a public company, and the price might be so low by the time anyone below the executive level can sell.
- bro45 7y ago
  Add to that dilution when owners can print more shares for investors and different types of shares (aka preferreds) when a common employee often gets nothing because all the money go to preferreds.
Traster 7y ago
The fundamental power dynamic of equity is always difficult for employees. Non C-level employees practically never have the negotiating power to demand equity. However, I've seen several occasions where founders have constantly promised their staff equity (whilst underpaying them) and never followed through. Dangling equity is a great tool for dick head founders.
pmontra 7y ago
She wrote in the thread that people received 1000, 2000 shares. They are trading at about 35$ now. Who knows, they could skyrocket a few years from now and be worth millions, but at the moment they are worth a good amount of money but not a life changing one. Nothing to be sad about. I worked for a startup many years ago (so they called themselves but being a phone operator before virtual ones they had to start big, 2k people and more.) They offered me options but I asked for more salary and less options. It turned to be the right decision because they got close to the IPO but never really did it.
codeddesign 7y ago
Someone please explain this to me: You apply for a job, you accept the job, and you work to perform your duties as is expected of you. Options are a perk that some companies offer. How is it acceptable in any way to believe you are owed something more than what was agreed upon? Personally I’m getting really tired of reading stuff like this where people see what others have and immediately feel they are owed the same or more.
- tluyben2 7y ago
  I did not read the article (WeWork is a joke of an overhyped company in most respects anyway, not sure why anyone bought into it to begin with) but it really depends does it not? You apply and accept but if you, for instance, find out later your colleagues get more for the same work or you take risks (coming from the EU, being able to lose your job at any moment is such a risk), that should be compensated with money or, if you like that kind of thing, options. If she accepted and it is still a competitive salary for the position then you are right. But if that changed or somehow there is risk that is compensated at other corps (in options or money) then it would be a valid complaint. You seem to imply in this case it is just whining or FOMO or something while being compensated properly. I think there are kind of cases worth reading about where it is actually simply unfair.
  - ktaylor 7y ago
    Maybe read the Twitter thread and then comment.
- jmull 7y ago
  I think it's the contrast between what she got vs what others got. The initial terms of employment don't have anything to do with it. At some point wework decides to grant options to some of their 120 employees -- basically a form of bonus. From her perspective, she's been working just as hard, productively and creatively as many other people who were granted the bonus, and had been there longer than most. The terms of the initial employment offer aren't really relevant since it sounds like various other people who weren't guaranteed options nevertheless received them (people couldn't have been guaranteed options under a plan that didn't exist when they hired).
mclightning 7y ago
Are you entitled to equity in a startup for being there early on? How is being "naive" and accepting a contract an argument for being mistreated? Am I being too skeptical?
jmull 7y ago
Ouch. For what it's worth for her peace-of-mind, I really doubt they would have given her options if she had made a push. Essentially, the decision had already been made. It's not impossible that they could have been convinced to change their minds, but it would have required some new or unexpected leverage to make it happen. (They would have already factored in that she could have become disgruntled or quit.) It certainly doesn't seem fair, though.
bobongo 7y ago
How many women were at the company at the time and how many of those received equity?

138 points by seapunk 7y ago

eps 7y ago

I understand this person is upset and likely bitter, but claiming that she remained "naive" about options after 4 years in a startup, when they started granting them (tweet #15), looks rather odd to me. There's gotta be more to the story than written.

nolok 7y ago

So she did what every HN thread on the matter says, with good reason : focus on your actual job and salary, not on equity that may or may not have some value some day. Dont get me wrong it appears the reason she ended up with none is not ok, but would that thread have been made if wework had ended up being one of those "failed" startup and those equities never gain any value? Would she have preferred to get equity but a lower salary (either at that moment, or on further yearly negotiation) if wework had ultimately failed? Or if like here she left long before she could use it? Don't think about what could have been with such things, equity as a lowly employee at a tech startup is very much like playing the lottery. If you're not directly invested in it such prefer the hard cash of your salary and don't let survivor bias make you regret that one time things could have been.

sooheon 7y ago
I think if the options are clear and up front, with the "exchange rate" between equity and salary laid out, what you said holds true. I think the tweeter is generally dissatisfied with how little transparency there was.
- nolok 7y ago
  But then the fact that it is equity has no weight what so ever in the story, it works the same with regular salary : ask for what you want, evaluate properly your position and worth, negotiate, change job if you genuinely think you're worth more but he won't agree, and don't let your boss be the one in charge alone of deciding what's fair to say you're worth, not when he has vested interest in that being as small as possible and you in it being as big as possible. Your boss is not on your side during your contract negotiation. Make the story about how they gave automatic raise based on position but she's not in the grid so don't get one and it's even something many have heard. Except maybe she would have reacted and argued more.
vinceguidry 7y ago
At the end of the day, the startup world is about creating opportunity where there was none before. It gets nasty, and even nastier when you realize the only personal recourse you will ever have for being in that world and not getting the opportunity despite doing the work is to go make your own opportunity, with even more work. If it's crushing your soul to be there, then you really don't belong. That's the long and the short of it. I personally look at the world of business as a necessary evil, that what makes business evil makes startups especially evil. But no less necessary because of it. I don't think any attempts to make startups less evil will do anything but just make it more evil. The attempts will fool people into believing that evil has been conquered, when it's just been painted over with lip service.
awinder 7y ago
I think there’s a genuine problem with the way that compensation has evolved though. This is in the 2nd or 3rd thread tweet, she says perfectly upfront that she was 23 and had no idea. That is far from unique, I talk to all kinds of people commonly who have the same tales of their early career. And I don’t think it’s particularly healthy to have complex compensation structures where workers are unprepared to actually make intentional informed decisions. That is ripe for abuse and deserves some sunshine.
- goatinaboat 7y ago
  Right. The reason given “you don’t get options because you have a unique job title” is clearly total bullshit to those of us who have been around the block, but being naive she believed it. That’s the issue. Her boss knowingly and deliberately deceived her.
psadri 7y ago
If you are joining a startup, you should be there to get equity. This is the main financial reason to join a startup. If you prefer cash, join a established company.
- deleted 7y ago
  [deleted]
tmcw 7y ago
HN threads focus on equity/salary tradeoffs, particularly for people joining a startup. This situation - where nobody was getting a salary 'cut' or negotiating a split, but where a startup was issuing equity to existing employees, is not what HN discusses, and her decision was not the same. Heck, her decision wasn't really a decision because a crummy company made it for her.

lordnacho 7y ago

It's very common for young people to not understand financial matters like options grants. That doesn't mean it's okay to benefit from their ignorance, especially as the company is now making a large number of people very wealthy. IMO it's a matter of doing the decent thing over the legal thing. Certainly if I was making a zillion bucks like the boss of WeWork I would find a way to pay the early employees who missed out.

em12a8 7y ago
> It's very common for young people to not understand financial matters like options grants Do you have any recommendations for learning more about that? I recently started working full-time at a tech company and I feel like I also have too little understanding of those things.
- hartem_ 7y ago
  Venture Deals (by Brad Feld) provides a great overview of startup finance matters. It is intended for founders and covers things other than employee equity. It’s an extremely useful read because it provides a holistic overview of the overall fundraising process and enables one to think about equity in a systematic way.
  - deanalevitt 7y ago
    The new book Secrets of Sand Hill Road by Scott Kupor is slightly newer, a little more readable, and talks a lot about dilution, but otherwise covers almost the same ground. Both books are great in understanding the space and motivations of various players.
    - hartem_ 7y ago
      That’s another great one! I would suggest reading the Venture Deals (which appeared quite practical to me) first and following it up with the Secrets (that’s great for understanding incentive structures and motivations of everyone involved).

doctorpangloss 7y ago

Equity is like a superpower in negotiation with employees. Because it is zero sum among them, it neutralizes collective bargaining—the most effective form of negotiation they have. So it’s not as black and white as, she should have done this or that differently, or someone should have made this or that disclosure or even helped her out. Equity is pretty magical in how it makes people misbehave and turn on each other. And feeling mad that she got a raw deal is the right emotion here.

avip 7y ago

I fail to see her point. There’s always lack of transparency in equity allocation. If there exist a startup with a transparent cap table, that’s surely exceptional.

xenihn 7y ago

>By no means do I feel entitled to equity I think she does come off as entitled. I also think she has every right to feel that way. #17 is really early. I'd go so far as to say she deserved it. It feels like ops people are generally under-appreciated in tech.

dustinmoris 7y ago

Her personal story aside, which I can imagine must feel a bit bitter, I am of the opinion that equity should only ever be given to employees who have a crucial and direct impact on the success of a business. If I join as a COO into an early startup then I take risks, play a crucial role in it's evolution and therefore deserve some equity to incentivise the best performance I can do. However, if I'm an account, even if I'm employee no 2 I would never expect equity. Doing accounts is not crucial and has nothing to do with the actual startup itself. If they pay a normal salary for an accountant then any accountant could just take that job and replace me. Why should the business owners who must have taken huge risks themselves ever give a piece of their hard earned cake to an accountant? Doesn't make sense, they get a fair salary for their work and that is all they deserve. So there's always two sides to everything. Not everyone always deserves what others have. That's a common misconception today where everyone looks for reasons to claim how they've been treated unfairly. EDIT: Before more people jump at my throat, I want to clarify that I am not talking about not compensating employees well because of a stupid reason like they can get replaced or something. That's not at all what I'm saying and I thought that was pretty clear. EVERYONE should get a great salary and great work/life perks, BUT when it comes specifically to giving away OWNERSHIP of one's business, then IMHO just being a great employee is not reason enough. I just don't think that everyone should own some % of a company just for rocking up every day and being nice to their colleagues. That's all.. if you disagree with that, then fair enough, but then say that, and don't try to teach me that people should get compensated well, because I never said otherwise.

alkonaut 7y ago
A startup is a huge risk regardless, so if I take a job at at a startup I want to be compensated for the risk. Even if I’m cleaning it fetching coffee. That doesn’t have to be equity but pay needs to be better than if I took the same job at the megacorp across the street, because the risk of suddenly being without a job when the company goes bankrupt is much smaller.
- heisenbit 7y ago
  If you are paid market rates, your career perspectives in the line of business you are in are typically not stellar and your career prospects improve by working in that company no matter how it does you are not taking a risk.

thinkingkong 7y ago

If its true that everyone else at the company got options but her thats pretty upsetting. If she was reporting directly to the COO and they had a good working relationship then that person should have fought for an exercise grant or eliminated the position.

Proven 7y ago

Didn't he join because he was "passionate about the job"?

huhtenberg 7y ago

The way I read it - she was being not-so-subtly hinted to search for another job. No way in hell the management wouldn't realize how refusing a 4-year old employee any options would look on her end. Zero is zero. It's like leaving a 1c tip at a restaurant. So this was most certainly done on purpose.

the_gipsy 7y ago
Or, the way she said it - she was young and ignorant of how options work. And management knew this, tried, and got away with it easily.
- huhtenberg 7y ago
  Issuing no options to a 4 year old employee can mean exactly one thing - it was not a very valuable employee that they weren't keen on retaining. That's about it.
  - prepend 7y ago
    I don’t know what an “Operations Associate” is but having a junior person report directly to the COO seems like a really junior admin/help with everything/type. It’s weird that the COO wouldn’t give options to her admin, I think. It could also be OP overestimating her value. When I was starting out I thought that working super hard and helping everywhere was the most important thing in the world to me. It took me a while to figure out how value is created for organizations.
    - goatinaboat 7y ago
      Microsoft and Apple made all their early secretaries rich.
      - dexterdog 7y ago
        Not the ones that quit when the companies were a just few years old.

nextstep 7y ago

Well, pessimistically it might not matter much either way. The employees with stock currently will likely be subject to a six month lock-up period after the IPO date. And it’s quite likely that the house of cards that is WeWork won’t survive that much scrutiny as a public company, and the price might be so low by the time anyone below the executive level can sell.

bro45 7y ago
Add to that dilution when owners can print more shares for investors and different types of shares (aka preferreds) when a common employee often gets nothing because all the money go to preferreds.

Traster 7y ago

The fundamental power dynamic of equity is always difficult for employees. Non C-level employees practically never have the negotiating power to demand equity. However, I've seen several occasions where founders have constantly promised their staff equity (whilst underpaying them) and never followed through. Dangling equity is a great tool for dick head founders.

pmontra 7y ago

She wrote in the thread that people received 1000, 2000 shares. They are trading at about 35$ now. Who knows, they could skyrocket a few years from now and be worth millions, but at the moment they are worth a good amount of money but not a life changing one. Nothing to be sad about. I worked for a startup many years ago (so they called themselves but being a phone operator before virtual ones they had to start big, 2k people and more.) They offered me options but I asked for more salary and less options. It turned to be the right decision because they got close to the IPO but never really did it.

codeddesign 7y ago

Someone please explain this to me: You apply for a job, you accept the job, and you work to perform your duties as is expected of you. Options are a perk that some companies offer. How is it acceptable in any way to believe you are owed something more than what was agreed upon? Personally I’m getting really tired of reading stuff like this where people see what others have and immediately feel they are owed the same or more.

tluyben2 7y ago
I did not read the article (WeWork is a joke of an overhyped company in most respects anyway, not sure why anyone bought into it to begin with) but it really depends does it not? You apply and accept but if you, for instance, find out later your colleagues get more for the same work or you take risks (coming from the EU, being able to lose your job at any moment is such a risk), that should be compensated with money or, if you like that kind of thing, options. If she accepted and it is still a competitive salary for the position then you are right. But if that changed or somehow there is risk that is compensated at other corps (in options or money) then it would be a valid complaint. You seem to imply in this case it is just whining or FOMO or something while being compensated properly. I think there are kind of cases worth reading about where it is actually simply unfair.
- ktaylor 7y ago
  Maybe read the Twitter thread and then comment.
jmull 7y ago
I think it's the contrast between what she got vs what others got. The initial terms of employment don't have anything to do with it. At some point wework decides to grant options to some of their 120 employees -- basically a form of bonus. From her perspective, she's been working just as hard, productively and creatively as many other people who were granted the bonus, and had been there longer than most. The terms of the initial employment offer aren't really relevant since it sounds like various other people who weren't guaranteed options nevertheless received them (people couldn't have been guaranteed options under a plan that didn't exist when they hired).

mclightning 7y ago

Are you entitled to equity in a startup for being there early on? How is being "naive" and accepting a contract an argument for being mistreated? Am I being too skeptical?

jmull 7y ago

Ouch. For what it's worth for her peace-of-mind, I really doubt they would have given her options if she had made a push. Essentially, the decision had already been made. It's not impossible that they could have been convinced to change their minds, but it would have required some new or unexpected leverage to make it happen. (They would have already factored in that she could have become disgruntled or quit.) It certainly doesn't seem fair, though.

bobongo 7y ago

How many women were at the company at the time and how many of those received equity?