6 ms·

There was a talk that's been shared on here from Ben Horowitz where he explicitly pitches the 90-day window as a way to screw employees. That's probably where t

by woah 5y ago

There was a talk that's been shared on here from Ben Horowitz where he explicitly pitches the 90-day window as a way to screw employees. That's probably where the perception comes from: > The second way to handle it - no companies do this, which is why I actually really like this post that he wrote - is you can say up front, " Look you are guaranteed to get your salary but for your stock to be meaningful, these are the things that have to happened. You have to have vested. Two, you have to stay until we get to an exit. Untile the company makes it. You've got other money." Finally, the company actually has to be worth something. Because 10 percent of nothing is nothing. The reason we set the policy this way is we really value people who stay. So don't join this company if you are going to join another one in 18 months because you're going to get screwed. Our policy guarantees you're going to get screwed. https://genius.com/B-horowitz-lecture-15-how-to-manage-annotated https://genius.com/B-horowitz-lecture-15-how-to-manage-annot...

ghiculescu 5y ago
He pitches it as a way of screwing employees who aggressively job hop. Not really the same thing.
- gkop 5y ago
  No, a16z is very explicit about their views. This is not from Ben but from the current managing partner: > A 10-year exercise window is really a direct wealth transfer from the employees who choose to remain at the company and build future shareholder value, to former employees who are no longer contributing to building the business/ its ultimate value. https://a16z.com/2016/06/23/options-timing/ https://a16z.com/2016/06/23/options-timing/
  - jacquesm 5y ago
    I read that as you're supposed to loyal right up to the point the company decides to lay you off and you better not think that you have any freedom once you sign on because we will retroactively screw you. The percentages in the typical option pool are not going to move the needle anyway and those employees that served the company early on took far greater risks than those that did so later and probably were paid much less too. So as far as I'm concerned they are well entitled to their stock.
    - gkop 5y ago
      Totally. It’s really fantastic that a16z is transparent about their values. It’s safe to assume other VCs share these beliefs but choose not to disclose them.
      - jacquesm 5y ago
        What will never cease to amaze me is that the likes of a16z while reaping billions on hardly any work at all will go to extreme ends to deny others what they simply earned through usually very hard work.
        foobiekr 5y ago
        When we were raising our series C, a potential investor (which we did not go with) wanted a requirement to cancel/claw back all _vested_ and _early exercised_ options that employees who had worked for us had and to put in place a buy-back-at-exercise-cost-or-cancel for current employees. No thanks. But it was eye opening.
        jacquesm 5y ago
        That is absolutely ridiculous. I'd love to know which investor that was so I can avoid working with them, if you could let me know I'd be very grateful (mail in profile). If not, I understand. Kudos for making the right call anyway, and that VC deserves to lose each and every deal they look at.
        foobiekr 5y ago
        As I am getting ready to raise a new series A, I’m a little hesitant at the moment to name and shame, even in email. The industry is hyper sensitive. But it’s for sure going to be in the book I plan to write about the valley.
        jacquesm 5y ago
        Understood. Much good luck with your raise!
  - jollybean 5y ago
    Except those employees have already earned those options. So it's a direct wealth transfer from people who have earned something, to institutional shareholders, most of whom are investors. It's odd because Ben seems like a nice guy. This reminds me of a kind of Thiel/Musk/Bezos ego thing, where otherwise rational and reasonable people do these couple of things where they delude themselves into the rationality of their decisions. But that 'character flaw' is actually a competitive advantage for an otherwise reasonable person.
  - tylerhou 5y ago
    (I know you're not arguing for this view, but) I just don't understand this perspective. The whole point about compensation is that it is explicitly a transfer of wealth, and through any transfer some people are going to "lose" money (on gross, but perhaps not lose money on net). That is, can't I make the same argument about being paid at all above the legal minimum? "Taking a higher-than-minimum salary is really a direct wealth transfer from the employees who choose to remain at the company to former employees who are no longer contributing to building the business/its ultimate value." The logic being that if a current employee takes a higher salary, then that reduces the valuation of the current (and future) company, which is a wealth transfer from future employees (who own some small share) to the current employee who may leave? From this argument a16z's position seems absurd...
  - Ozzie_osman 5y ago
    I hate that article. It's not a direct wealth transfer. Using that logic you could argue _anything_ is a direct wealth transfer. Why not claw back bonuses and even salaries too while you're at it? I'm a founder. If someone works with me for three years then has to move on, they've earned their equity. I want them to keep it and root for us from the sidelines. It's sweat equity, not "stay until a liquidity event" equity. Especially with founders themselves starting to more aggressively take money off the table using secondaries (which aren't always offered to their employees). As Zach Holman put it, fuck your 90 day exercise window. https://zachholman.com/posts/fuck-your-90-day-exercise-window/ https://zachholman.com/posts/fuck-your-90-day-exercise-windo... Also, if you're a founder, note that your lawyers will almost certainly towards 90-day windows (and your investors might too). It might take some work to get something more employee-favorable.
- 21723 5y ago
  Yeah, because fuck those workers who try to make a free market work for them once in a while. Don't they realize that market talk is only a way for their social class superiors to justify doing whatever they want, and that it isn't for them?
- HWR_14 5y ago
  I see no reason to screw employees who job hop. It seems like if 1/10 as much effort was put into making your workplace pleasant, you'd have fewer people leave.
- woah 5y ago
  That's what always seemed like bullshit to me. If you want to have a 4 year cliff to discourage job hopping, then give people a 4 year cliff. Why try to weasel them into it?
21723 5y ago
At this point, I'm surprised when other people are surprised that founders and investors work together to screw employees. "Work", in the corporate sense, is the same sort of exploitative, morally vacuous, might-makes-right dominance hierarchy that humans have been forming for thousands of years. We haven't evolved beyond that garbage yet.

by woah 5y ago

ghiculescu 5y ago

He pitches it as a way of screwing employees who aggressively job hop. Not really the same thing.

gkop 5y ago
No, a16z is very explicit about their views. This is not from Ben but from the current managing partner: > A 10-year exercise window is really a direct wealth transfer from the employees who choose to remain at the company and build future shareholder value, to former employees who are no longer contributing to building the business/ its ultimate value. https://a16z.com/2016/06/23/options-timing/ https://a16z.com/2016/06/23/options-timing/
- jacquesm 5y ago
  I read that as you're supposed to loyal right up to the point the company decides to lay you off and you better not think that you have any freedom once you sign on because we will retroactively screw you. The percentages in the typical option pool are not going to move the needle anyway and those employees that served the company early on took far greater risks than those that did so later and probably were paid much less too. So as far as I'm concerned they are well entitled to their stock.
  - gkop 5y ago
    Totally. It’s really fantastic that a16z is transparent about their values. It’s safe to assume other VCs share these beliefs but choose not to disclose them.
    - jacquesm 5y ago
      What will never cease to amaze me is that the likes of a16z while reaping billions on hardly any work at all will go to extreme ends to deny others what they simply earned through usually very hard work.
      - foobiekr 5y ago
        When we were raising our series C, a potential investor (which we did not go with) wanted a requirement to cancel/claw back all _vested_ and _early exercised_ options that employees who had worked for us had and to put in place a buy-back-at-exercise-cost-or-cancel for current employees. No thanks. But it was eye opening.
        jacquesm 5y ago
        That is absolutely ridiculous. I'd love to know which investor that was so I can avoid working with them, if you could let me know I'd be very grateful (mail in profile). If not, I understand. Kudos for making the right call anyway, and that VC deserves to lose each and every deal they look at.
        foobiekr 5y ago
        As I am getting ready to raise a new series A, I’m a little hesitant at the moment to name and shame, even in email. The industry is hyper sensitive. But it’s for sure going to be in the book I plan to write about the valley.
        jacquesm 5y ago
        Understood. Much good luck with your raise!
- jollybean 5y ago
  Except those employees have already earned those options. So it's a direct wealth transfer from people who have earned something, to institutional shareholders, most of whom are investors. It's odd because Ben seems like a nice guy. This reminds me of a kind of Thiel/Musk/Bezos ego thing, where otherwise rational and reasonable people do these couple of things where they delude themselves into the rationality of their decisions. But that 'character flaw' is actually a competitive advantage for an otherwise reasonable person.
- tylerhou 5y ago
  (I know you're not arguing for this view, but) I just don't understand this perspective. The whole point about compensation is that it is explicitly a transfer of wealth, and through any transfer some people are going to "lose" money (on gross, but perhaps not lose money on net). That is, can't I make the same argument about being paid at all above the legal minimum? "Taking a higher-than-minimum salary is really a direct wealth transfer from the employees who choose to remain at the company to former employees who are no longer contributing to building the business/its ultimate value." The logic being that if a current employee takes a higher salary, then that reduces the valuation of the current (and future) company, which is a wealth transfer from future employees (who own some small share) to the current employee who may leave? From this argument a16z's position seems absurd...
- Ozzie_osman 5y ago
  I hate that article. It's not a direct wealth transfer. Using that logic you could argue _anything_ is a direct wealth transfer. Why not claw back bonuses and even salaries too while you're at it? I'm a founder. If someone works with me for three years then has to move on, they've earned their equity. I want them to keep it and root for us from the sidelines. It's sweat equity, not "stay until a liquidity event" equity. Especially with founders themselves starting to more aggressively take money off the table using secondaries (which aren't always offered to their employees). As Zach Holman put it, fuck your 90 day exercise window. https://zachholman.com/posts/fuck-your-90-day-exercise-window/ https://zachholman.com/posts/fuck-your-90-day-exercise-windo... Also, if you're a founder, note that your lawyers will almost certainly towards 90-day windows (and your investors might too). It might take some work to get something more employee-favorable.
21723 5y ago
Yeah, because fuck those workers who try to make a free market work for them once in a while. Don't they realize that market talk is only a way for their social class superiors to justify doing whatever they want, and that it isn't for them?
HWR_14 5y ago
I see no reason to screw employees who job hop. It seems like if 1/10 as much effort was put into making your workplace pleasant, you'd have fewer people leave.
woah 5y ago
That's what always seemed like bullshit to me. If you want to have a 4 year cliff to discourage job hopping, then give people a 4 year cliff. Why try to weasel them into it?

21723 5y ago

At this point, I'm surprised when other people are surprised that founders and investors work together to screw employees. "Work", in the corporate sense, is the same sort of exploitative, morally vacuous, might-makes-right dominance hierarchy that humans have been forming for thousands of years. We haven't evolved beyond that garbage yet.