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It'll be interesting to see how this'll affect startups down the line. If employees aren't cashing out in a reasonable amount of time (or at all), will the maj
by jklm 7y ago
It'll be interesting to see how this'll affect startups down the line. If employees aren't cashing out in a reasonable amount of time (or at all), will the majority of startups suffer a brain drain of top talent? Will startups need to come up with a new way of compensation beyond just equity?
- koreth1 7y agoI think that's already happening to some degree, though it's not a "new way" exactly. Totally anecdotal, of course, but based on watching people move between jobs in my professional circle, it seems like experienced people are no longer willing to take nearly as much of a salary cut for the sake of equity as they used to. A startup that doesn't offer competitive salary and equity will have a pretty tough time hiring the most in-demand employees.
- mdorazio 7y agoOn the flip side, it seems there's still an endless pool of less-experienced people who are chomping at the bit to work at startups. There's a reason startups recruit primarily people in their 20s.
- ralusek 7y agoCan't private companies give out equity just fine?
- mikeg8 7y agoYes? But if there is no intention of an IPO, where an early employee has a reasonably easy path to liquidate their stock/options, what is the benefit of owning equity in a private company when there may be a limited/non-existent market for said equity?
- ralusek 7y agoPotentially entitled to a percentage of quarterly profits, among other things. Draft whatever terms you'd like.
- scurvy 7y agoStartups these days eschew profits for "reinvesting in the bueiness." Heck, many publicly traded companies do this, too. Also, let's be realistic in what you're asking for here.