7 ms·

You're making a veritable crap-ton of assumptions here. Happy to talk about specific concerns, but not if you're going in to this with guns blazing looking for

You're making a veritable crap-ton of assumptions here. Happy to talk about specific concerns, but not if you're going in to this with guns blazing looking for a witch to burn.

ccmcarey 6y ago
I'm curious how it works from a technical standpoint. If they invest, do they not own shares of the company, and then during the sale the shares are sold, did they just gift the shares back to you personally? Does that have tax implications?
- Shpigford 6y ago
  Investment vehicle was a SAFE. They basically cancelled the SAFE as part of the deal. We've had carryover losses for years, so from a tax perspective, there was no hit on either side.
  - ccmcarey 6y ago
    Makes sense, thanks!
  - TechBro8615 6y ago
    Wouldn't this count as a liquidation event and thus give them the right to purchase shares at the price that the buyer is purchasing them at?
    - kirubakaran 6y ago
      Depends on whether it was a stock sale or an asset sale.
high_derivative 6y ago
So what did employees get?
- Shpigford 6y ago
  Depends on the employees and when they joined and if they exercised stock options or not. Big range from a few thousand to over $80,000.
  - falcolas 6y ago
    $80k for how many years of work? Unless it’s one, I’m with the parent. I’m sure it’s all legal and ‘equitable’ according to the terms, but that’s peanuts of a return for somewhere between 4 and 7 years of work (based off a typical vesting schedule).
    - twox2 6y ago
      It's peanuts, but it's also REALITY. Few people get big windfalls working for startups as employees or even founders, but maybe you get a little bonus on top of your salary if there's an exit.
      - falcolas 6y ago
        Few employees may get a windfall in reality, but it doesn’t make it easier to see (nor does it justify the founder’s choices). Those employees are just as responsible for the company’s success as the founder is; it sucks to see them get shafted while the founder walks away with “fuck you” money.
        twox2 6y ago
        Agreed, which is why it's good that this stuff is being shared. It's a datapoint to consider for those of us as we make career choices. But let's face it, if we are not founders, then we are just "the help".
        falcolas 6y ago
        And without “the help”, most founders (OP included) won’t make it to the sale. You can’t scale without “the help”. You can’t grow your market without “the help”. To badly paraphrase someone: “The idea isn’t what’s valuable, the implementation is.” That implementation is probably >90% thanks to “the help”.
pc86 6y ago
Now that you mention it, you're right, maybe some of that extra $300k went to the employees? I don't know because I wasn't in the room. I'm curious how much money employees got, and why $3.7 million was enough when $2.9 wasn't.
- Shpigford 6y ago
  That entire $300k went to employees. As for $3.7 vs $2.9...that was basically the number that, to oversimplify, would roughly give the outcome I wanted for "retirement" when it comes to investment interest over the next 50 years. Basically, it's the number I felt comfortable with to not instantly feel like I needed to get back to work in a few years.
  - deleted 6y ago
    [deleted]
- hajimemash 6y ago
  He worked out a win-win deal that gives them publicity and him $4M. In gaming terms, I believe this play is known as a QUAD KILL.

You're making a veritable crap-ton of assumptions here. Happy to talk about specific concerns, but not if you're going in to this with guns blazing looking for a witch to burn.

ccmcarey 6y ago

I'm curious how it works from a technical standpoint. If they invest, do they not own shares of the company, and then during the sale the shares are sold, did they just gift the shares back to you personally? Does that have tax implications?

Shpigford 6y ago
Investment vehicle was a SAFE. They basically cancelled the SAFE as part of the deal. We've had carryover losses for years, so from a tax perspective, there was no hit on either side.
- ccmcarey 6y ago
  Makes sense, thanks!
- TechBro8615 6y ago
  Wouldn't this count as a liquidation event and thus give them the right to purchase shares at the price that the buyer is purchasing them at?
  - kirubakaran 6y ago
    Depends on whether it was a stock sale or an asset sale.

high_derivative 6y ago

So what did employees get?

Shpigford 6y ago
Depends on the employees and when they joined and if they exercised stock options or not. Big range from a few thousand to over $80,000.
- falcolas 6y ago
  $80k for how many years of work? Unless it’s one, I’m with the parent. I’m sure it’s all legal and ‘equitable’ according to the terms, but that’s peanuts of a return for somewhere between 4 and 7 years of work (based off a typical vesting schedule).
  - twox2 6y ago
    It's peanuts, but it's also REALITY. Few people get big windfalls working for startups as employees or even founders, but maybe you get a little bonus on top of your salary if there's an exit.
    - falcolas 6y ago
      Few employees may get a windfall in reality, but it doesn’t make it easier to see (nor does it justify the founder’s choices). Those employees are just as responsible for the company’s success as the founder is; it sucks to see them get shafted while the founder walks away with “fuck you” money.
      - twox2 6y ago
        Agreed, which is why it's good that this stuff is being shared. It's a datapoint to consider for those of us as we make career choices. But let's face it, if we are not founders, then we are just "the help".
        falcolas 6y ago
        And without “the help”, most founders (OP included) won’t make it to the sale. You can’t scale without “the help”. You can’t grow your market without “the help”. To badly paraphrase someone: “The idea isn’t what’s valuable, the implementation is.” That implementation is probably >90% thanks to “the help”.

pc86 6y ago

Now that you mention it, you're right, maybe some of that extra $300k went to the employees? I don't know because I wasn't in the room. I'm curious how much money employees got, and why $3.7 million was enough when $2.9 wasn't.

Shpigford 6y ago
That entire $300k went to employees. As for $3.7 vs $2.9...that was basically the number that, to oversimplify, would roughly give the outcome I wanted for "retirement" when it comes to investment interest over the next 50 years. Basically, it's the number I felt comfortable with to not instantly feel like I needed to get back to work in a few years.
- deleted 6y ago
  [deleted]
hajimemash 6y ago
He worked out a win-win deal that gives them publicity and him $4M. In gaming terms, I believe this play is known as a QUAD KILL.