5 ms·

> One possibility is to replace early employee (first ~10 employees) stock options with the same Restricted Stock Agreements (RSAs) as the founders. I am sure

> One possibility is to replace early employee (first ~10 employees) stock options with the same Restricted Stock Agreements (RSAs) as the founders. I am sure RSA are and will always be available to those with the skilleset that commands this level of compensation. I am unclear what would motivate the founding team or investors in a start-up to act otherwise.

brabel 6y ago
Why would anyone want to work for your startup when they can get much higher salaries working for larger companies? Stock options used to be that differentiator for startups... now it's just an empty promise in most places.
- guywhocodes 6y ago
  Personally for me it has always been faster personal growth from wider responsibilities. This makes a lot of sense in some stages of your career and your career goals but hardly for everyone.
  - mlthoughts2018 6y ago
    I’ve never heard of any startups where you can obtain faster skill or personal growth. “Wear many hats” means you must be whatever type of firefighting janitor the company needs this week, which often causes skill atrophy not skill growth. Larger companies not only offer better compensation, but usually offer much better career development, responsibility growth, training and “learn by doing” opportunities. The startup will promise you won’t be blocked by bureaucracy and as an early hire you can lead the design. Total lies. The bureaucracy and dysfunction will be even worse and probably involve a bunch of immature egos and “the design” will be endlessly compromised to get each successive round of diluting funding that yokes you to more and more traditional management bureaucracy through VCs. After experiencing the special hell of unrestrained founders who don’t know what they are doing and nepotism hires all through middle management, most people quickly realize it’s an insane trap and wish for the comfort of large firm bureaucracy, where at least there’s some minimal policy protection against sexual harassment or cultivating alcoholism as a company value or generally grinding unwitting young people into the ground with 80 hour weeks.
    - Nimitz14 6y ago
      This does not match my experience.
      - mlthoughts2018 6y ago
        Then you have an extremely rare experience. It’s like a professor who did happen to get tenure listening to all the post docs talking about how awful academia is. I’m happy for that one lottery winner but their experience doesn’t count for anything.
        Nimitz14 6y ago
        Lol, have you considered it might be you who had the extremely rare experience?
        mlthoughts2018 6y ago
        If it weren’t for all the ubiquitous articles talking about bait and switch startup jobs, poor startup compensation, cheating founders, controlling VCs, slave driver mentality, rip off stock options, and the poor survivability of companies, you might have a point.
        jariel 6y ago
        Totally the opposite. Most startups are dynamic, most big corporations are not. They are 'big' because they are sitting on a value chain monopoly. The same chocolate bars have been in my grocery aisle for 20 years. Variations on the same soap. Some startups are very poorly run, but most are not led by 'unrestrained jerks'.
        mlthoughts2018 6y ago
        No, it’s not like this. Most startups promise to be dynamic as a tactic to pay people less and swindle them on poor options deals, then they bait and switch you, the work experience is not as advertised.
- cik 6y ago
  I work with startups because of the array of possibilities - none of them monetary. I've never cared about shares, and mentor folks to do the same. If you do what you love you never work a day in your life. But if you chase the pot of gold, you have to hope there's always sunshine after the rain.
  - ClumsyPilot 6y ago
    So if people enjoy there work we don't have to compensate them competitively?
    - Ygg2 6y ago
      See gaming industry.
      - ClumsyPilot 6y ago
        Abusive work practices, regular crunch time and underpays for talent?
        Ygg2 6y ago
        Yeah, thanks to everyone wanting to work making games.
    - cik 6y ago
      I don't see how what I wrote led to this assumption. It's just that I don't value the shares in a startup - ever. I value the salary side, and enjoy the interesting work.
      - hajimemash 6y ago
        To many people who value $$$ to get other important things in their life, shares are a meaningful factor in their expected value from devoting their life to a job. So when you say you don't work at a startup for monetary reasons, and that you don't care about shares, which has an expected value of real money despite the uncertain outcome, it's natural to wonder if you don't care about compensation aka money.
- cddotdotslash 6y ago
  > Why would anyone want to work for your startup when they can get much higher salaries working for larger companies? As much as I agree with the "lottery ticket" mentality, this line of thinking has been popular to parrot on HN for at least 5-10 years. And as far as I'm aware, startups don't have much trouble attracting senior talent. So until that changes significantly, they are going to continue offering lower salaries and bigger lottery tickets for as long as they can. Why would they do otherwise?
  - hn_throwaway_99 6y ago
    > And as far as I'm aware, startups don't have much trouble attracting senior talent That seems like a pretty broad assessment to make on a hunch.
    - cddotdotslash 6y ago
      Admittedly I'm just speaking from conversations within my own network, but if hiring this kind of talent was significantly difficult then I'd expect to see broad, industry-level changes to how startup compensation was done. Companies can't survive if they can't hire people, and yet the same ISO practices remain aside from a few recent trend setters. So it seems most of the eligible candidate pool is still accepting this form of compensation.
  - deleted 6y ago
    [deleted]
JumpCrisscross 6y ago
> I am unclear what would motivate the founding team or investors in a start-up to act otherwise RSAs and RSUs are far less liquid than equity. They can typically only be sold into a company-wide liquidity event.
dpeck 6y ago
RSAs for early employees (everything before an investment) isnt uncommon.
mobjack 6y ago
You need to pay taxes on RSAs when granted so they mainly make sense when the share price is really low on paper. Once the valuation is higher, RSUs can shield employees from paying taxes until a liquidity event.

brabel 6y ago

Why would anyone want to work for your startup when they can get much higher salaries working for larger companies? Stock options used to be that differentiator for startups... now it's just an empty promise in most places.

guywhocodes 6y ago
Personally for me it has always been faster personal growth from wider responsibilities. This makes a lot of sense in some stages of your career and your career goals but hardly for everyone.
- mlthoughts2018 6y ago
  I’ve never heard of any startups where you can obtain faster skill or personal growth. “Wear many hats” means you must be whatever type of firefighting janitor the company needs this week, which often causes skill atrophy not skill growth. Larger companies not only offer better compensation, but usually offer much better career development, responsibility growth, training and “learn by doing” opportunities. The startup will promise you won’t be blocked by bureaucracy and as an early hire you can lead the design. Total lies. The bureaucracy and dysfunction will be even worse and probably involve a bunch of immature egos and “the design” will be endlessly compromised to get each successive round of diluting funding that yokes you to more and more traditional management bureaucracy through VCs. After experiencing the special hell of unrestrained founders who don’t know what they are doing and nepotism hires all through middle management, most people quickly realize it’s an insane trap and wish for the comfort of large firm bureaucracy, where at least there’s some minimal policy protection against sexual harassment or cultivating alcoholism as a company value or generally grinding unwitting young people into the ground with 80 hour weeks.
  - Nimitz14 6y ago
    This does not match my experience.
    - mlthoughts2018 6y ago
      Then you have an extremely rare experience. It’s like a professor who did happen to get tenure listening to all the post docs talking about how awful academia is. I’m happy for that one lottery winner but their experience doesn’t count for anything.
      - Nimitz14 6y ago
        Lol, have you considered it might be you who had the extremely rare experience?
        mlthoughts2018 6y ago
        If it weren’t for all the ubiquitous articles talking about bait and switch startup jobs, poor startup compensation, cheating founders, controlling VCs, slave driver mentality, rip off stock options, and the poor survivability of companies, you might have a point.
      - jariel 6y ago
        Totally the opposite. Most startups are dynamic, most big corporations are not. They are 'big' because they are sitting on a value chain monopoly. The same chocolate bars have been in my grocery aisle for 20 years. Variations on the same soap. Some startups are very poorly run, but most are not led by 'unrestrained jerks'.
        mlthoughts2018 6y ago
        No, it’s not like this. Most startups promise to be dynamic as a tactic to pay people less and swindle them on poor options deals, then they bait and switch you, the work experience is not as advertised.
cik 6y ago
I work with startups because of the array of possibilities - none of them monetary. I've never cared about shares, and mentor folks to do the same. If you do what you love you never work a day in your life. But if you chase the pot of gold, you have to hope there's always sunshine after the rain.
- ClumsyPilot 6y ago
  So if people enjoy there work we don't have to compensate them competitively?
  - Ygg2 6y ago
    See gaming industry.
    - ClumsyPilot 6y ago
      Abusive work practices, regular crunch time and underpays for talent?
      - Ygg2 6y ago
        Yeah, thanks to everyone wanting to work making games.
  - cik 6y ago
    I don't see how what I wrote led to this assumption. It's just that I don't value the shares in a startup - ever. I value the salary side, and enjoy the interesting work.
    - hajimemash 6y ago
      To many people who value $$$ to get other important things in their life, shares are a meaningful factor in their expected value from devoting their life to a job. So when you say you don't work at a startup for monetary reasons, and that you don't care about shares, which has an expected value of real money despite the uncertain outcome, it's natural to wonder if you don't care about compensation aka money.
cddotdotslash 6y ago
> Why would anyone want to work for your startup when they can get much higher salaries working for larger companies? As much as I agree with the "lottery ticket" mentality, this line of thinking has been popular to parrot on HN for at least 5-10 years. And as far as I'm aware, startups don't have much trouble attracting senior talent. So until that changes significantly, they are going to continue offering lower salaries and bigger lottery tickets for as long as they can. Why would they do otherwise?
- hn_throwaway_99 6y ago
  > And as far as I'm aware, startups don't have much trouble attracting senior talent That seems like a pretty broad assessment to make on a hunch.
  - cddotdotslash 6y ago
    Admittedly I'm just speaking from conversations within my own network, but if hiring this kind of talent was significantly difficult then I'd expect to see broad, industry-level changes to how startup compensation was done. Companies can't survive if they can't hire people, and yet the same ISO practices remain aside from a few recent trend setters. So it seems most of the eligible candidate pool is still accepting this form of compensation.
- deleted 6y ago
  [deleted]

JumpCrisscross 6y ago

> I am unclear what would motivate the founding team or investors in a start-up to act otherwise RSAs and RSUs are far less liquid than equity. They can typically only be sold into a company-wide liquidity event.

dpeck 6y ago

RSAs for early employees (everything before an investment) isnt uncommon.

mobjack 6y ago

You need to pay taxes on RSAs when granted so they mainly make sense when the share price is really low on paper. Once the valuation is higher, RSUs can shield employees from paying taxes until a liquidity event.