Startup Stock Options – Why A Good Deal Has Gone Bad https://steveblank.com/2019/04/10/startup-stock-options-why-a-good-deal-has-gone-bad/ https://steveblank.co

Startup Stock Options – Why A Good Deal Has Gone Bad https://steveblank.com/2019/04/10/startup-stock-options-why-a-good-deal-has-gone-bad/ https://steveblank.com/2019/04/10/startup-stock-options-why-... Lessons Learned - Venture Capital structures were set up for a world in which successful companies exited in 6-8 years and didn’t raise too much capital - Venture capital growth funds are now giving startups the cash they would have received at an IPO -- “Growth Capital” moved the need for an IPO out another five years -- This allows VCs to capture the increase in market cap in the company --It may have removed the incentive for non-founders to want to work in a startup versus a large company --As stock options with four-year vesting are no longer a good deal - Investors and Founders have changed the model to their advantage, but no one has changed the model for early employees --VCs need to consider a new stock incentive model – RSA’s for the first key hires and then RSU’s – Restricted Stock Units for everyone else - Large companies now have an opportunity to attract some of the talent that previously went elsewhere