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I have to say that I've been surprised by the reaction to this story on HN. I think the behavior of Skype's owners and executives was revolting and (echoing PG'

I have to say that I've been surprised by the reaction to this story on HN. I think the behavior of Skype's owners and executives was revolting and (echoing PG's comment on the other thread), not at all common from what I've seen & heard in my career. I think there is also at least one clear lesson. First and foremost, choose who you work with based on their character. I think if you're across the table from Silver Lake, Tony Bates, Brian O’Shaughnessy or (as much as I hate to say it) Andreessen Horowitz, you should build in a significant "character multiple" based on how they acted here. You should also have MOFO or another top legal team on your side. If you're an engineer at any company any of these people are invested in, you should also be reading your contract extremely carefully, perhaps also with legal help. Having options that vest with "no value" is just absurd. I'll note that I have no stake in this whatsoever, but it just makes me sick. My partner and I sold our company (for a tiny fraction of this deal's value) and spent a significant amount of the deal time negotiating on behalf of our employees after eliminating buyers who we wouldn't want to work for or didn't fully trust to take care of them. I don't want to portray us as saints (we're not, but we both highly value our reputations), but it was the right thing to do and most people I have worked with would do the same. We're in an amazingly tight market for engineers right now. Please, choose your employer very carefully based on their reputation.

dgabriel 15y ago
I worked for start-ups from my first job on up to three years ago (that's 10 years, because I am old). I have worked 60, 80, 100 hour weeks sometimes. Each of the start ups in which I was an engineer were successfully acquired. The owners got millions in each case, I got a net payout over the course of four start-ups of about 15 grand. Not 15 grand each, 15 grand total. Sometimes I think about what a fool I was, and how much more money I could have made working for large companies at market rates, instead of killing myself for substandard salaries, even though there was some "love of the game" involved. Why is it that we need to exploit people in this game? Especially young engineers or execs with their first VP experiences. Some people get rich, most people are pawns.
- joezydeco 15y ago
  Funny thing...the startup where I'm working is about to face this exact situation. If the acquisition being planned does happen, I'll probably gross a few grand and that's it. As the only software engineer in the startup I've apaprently been identified as a key person in the move. I'd like to think this gives me some leverage, it would take them 3-4 months to find a replacement and get them up to speed. It was my work on early customers and technology demos that helped land the deal, yet I feel like none of that is being recognized. What would you do if you were me?
  - EwanG 15y ago
    Take my contract to a lawyer and see if I have any of the leverage I "think" I have. I suspect you don't have much. Basically if you are working for a startup, (or any company where you are building sweat equity), and your employee number is larger than 2, then you had better have what you think you are getting spelled out specifically in your contract unless you really don't care. That said, I don't think it's that people are "out to get you" as much as they are usually rather focused during a transition on making sure they themselves are taken care of.
    - ootachi 15y ago
      The leverage in this case has nothing to do with the specific employment contract and everything to do with the market for engineers right now. I suspect that having the only engineer who understands the code threaten to leave right before an acquisition actually does constitute significant leverage. I second the advice to ask for a retention bonus. Cash compensation is the easiest way to ensure that no shenanigans can take place.
      - joezydeco 15y ago
        Thanks everyone for the advice. Long story short I'm definitely in an "at will" state, my employee # is higher than 2, and while I've received a small amount of restricted stock that will vest immediately upon takeover, it won't be worth much and I believe there will be an earn-out to stretch that value over a way longer period of time. So pretty much nothing of value. If we do this deal we're all pretty much going to be slotted into the new company with predetermined titles and salary. I've already made my case to the CEO of where I expect to land on both parts, so I'm sure he knows what I'm thinking. I have absolutely no qualms about leaving for another job, so it's his choice to make. We'll see what happens. I just don't know if there is anything else I should be doing at this point. I could make a lot of noise and make things very uncomfortable, but in the end that will probably only hurt just me. My thought was to press for a retention employment contract, but perhaps just a retention bonus is the way to go.

dgabriel 15y ago

I worked for start-ups from my first job on up to three years ago (that's 10 years, because I am old). I have worked 60, 80, 100 hour weeks sometimes. Each of the start ups in which I was an engineer were successfully acquired. The owners got millions in each case, I got a net payout over the course of four start-ups of about 15 grand. Not 15 grand each, 15 grand total. Sometimes I think about what a fool I was, and how much more money I could have made working for large companies at market rates, instead of killing myself for substandard salaries, even though there was some "love of the game" involved. Why is it that we need to exploit people in this game? Especially young engineers or execs with their first VP experiences. Some people get rich, most people are pawns.

joezydeco 15y ago
Funny thing...the startup where I'm working is about to face this exact situation. If the acquisition being planned does happen, I'll probably gross a few grand and that's it. As the only software engineer in the startup I've apaprently been identified as a key person in the move. I'd like to think this gives me some leverage, it would take them 3-4 months to find a replacement and get them up to speed. It was my work on early customers and technology demos that helped land the deal, yet I feel like none of that is being recognized. What would you do if you were me?
- EwanG 15y ago
  Take my contract to a lawyer and see if I have any of the leverage I "think" I have. I suspect you don't have much. Basically if you are working for a startup, (or any company where you are building sweat equity), and your employee number is larger than 2, then you had better have what you think you are getting spelled out specifically in your contract unless you really don't care. That said, I don't think it's that people are "out to get you" as much as they are usually rather focused during a transition on making sure they themselves are taken care of.
  - ootachi 15y ago
    The leverage in this case has nothing to do with the specific employment contract and everything to do with the market for engineers right now. I suspect that having the only engineer who understands the code threaten to leave right before an acquisition actually does constitute significant leverage. I second the advice to ask for a retention bonus. Cash compensation is the easiest way to ensure that no shenanigans can take place.
    - joezydeco 15y ago
      Thanks everyone for the advice. Long story short I'm definitely in an "at will" state, my employee # is higher than 2, and while I've received a small amount of restricted stock that will vest immediately upon takeover, it won't be worth much and I believe there will be an earn-out to stretch that value over a way longer period of time. So pretty much nothing of value. If we do this deal we're all pretty much going to be slotted into the new company with predetermined titles and salary. I've already made my case to the CEO of where I expect to land on both parts, so I'm sure he knows what I'm thinking. I have absolutely no qualms about leaving for another job, so it's his choice to make. We'll see what happens. I just don't know if there is anything else I should be doing at this point. I could make a lot of noise and make things very uncomfortable, but in the end that will probably only hurt just me. My thought was to press for a retention employment contract, but perhaps just a retention bonus is the way to go.