5 ms·

Google Employees Watch In Horror As 60 Percent Of Their Stock Options Drown

42 points by nickb 18y ago

josefresco 18y ago
329 is the magic number (of worthlessness) eh? 328.8 as of right now.
pchristensen 18y ago
"The free food and transportation are great perks and all, but let’s get real here. Without the financial upside those stock options represent, Google employees will start looking elsewhere." Free food and transportation might be even more valuable now. Anyone that wants to work at a big company won't find better stock options and definitely not a better work environment. Anyone that wants to work in a startup environment was going to leave Google eventually. So no, Googler's won't be running for the door. I'd be interested to see how the internal market for reselling stock options looks right now.
- nickb 18y ago
  Forget about food and transportation... having a job will be the most valuable thing of them all. I doubt many Googlers will 'start looking elsewhere'... where exactly would they look? Dubai? China? Heh.
  - tdavis 18y ago
    Exactly. I am no longer convinced that people actually think before writing TC articles.
    - omouse 18y ago
      TC has basically become part of the mainstream media then? That's a shame, I guess it's back to the Economist for me
      - mattmaroon 18y ago
        Did you ever find TC to be on level with The Economist, or even in the same ballpark? Or hell, even the same sport? TechCrunch does one thing very well, which is up to the moment headlines (on a rapidly changing industry) with just enough commentary that you can get a feel for what happened. It's one very small notch above a Twitter feed. If you're looking there for in-depth analysis, you're always going to be disappointed.
        jumper 18y ago
        I dunno... I already wrote TC off as a waste of my time along with things like valleywag quite some time ago, so I could easily be ignorantly biased, but for me I'd describe them as mainly being "good" at link-baity bullshit titles + wild trollish theories about what could happen presented as fact press release style to stir up interest... I'm sure they have some value, but it all comes down to that magical signal-to-noise ratio question... and this article here doesn't appear so bad but also doesn't seem very good either....
        mattmaroon 18y ago
        Yeah, I don't know. I think TC is pretty good at giving you breaking startup news. I think you could pretty much read nothing but the headlines and get about 95% of full value out of it, while saving yourself about 90% of the time involved.
        tdavis 18y ago
        If you're looking there for in-depth analysis, you're always going to be disappointed. Quite the contrary; I want TC to report start-up news. That's it. I don't want any editorials, op-eds, or analysis. Why? Because, as many many articles including this one prove, they are nearly always completely ignorant of the situation and say ridiculously stupid shit as a result. They do that well, as you said, but it's when they go beyond the bare necessities and actual facts into the realm of "analysis" that the writers (and editors and everyone else between an article and my face) fall flat on their asses and cause my blood pressure to rise in the process. "Shit, I can't swim. I know I can't. So you know what I do? I stay my black ass outta the pool."
  - icey 18y ago
    Recognizing that probably none of us are old enough to have seen a downturn of this scale; the demand for quality talent didn't seem to diminish much in our other recent downturns.
  - bigbang 18y ago
    "I doubt many Googlers will 'start looking elsewhere'... where exactly would they look? Dubai? China? Heh." Its not like Google is best company in the world(those days are gone). Even if, company doesnt matter to me,what matters is only the work(and the smartness of co-workers) what Iam doing. I would any day better compromise on the smartness of co-workers as opposed to compromising the quality of work. By this, there could be a lot of better jobs elsewhere.
  - fallentimes 18y ago
    Agreed, but offering free food, transportation, health care, cell phone, etc is an awesome & possibly economical perk. Most of that stuff can be paid for with pre tax dollars as opposed to having to pay for it yourself with after tax dollars. The place I used to work paid for my phone, breakfast, daily lunches, insurance and metro card. My only fixed costs each month were groceries, dinner, rent, cable/internet, minor personal items & student loans.
- goodkarma 18y ago
  I thought they were cutting back on the free food etc.? Remember Sergey's comment about the M&M's and bottled water?
jcl 18y ago
On the bright side, I suppose, any new Google employees will have a bigger gain to look forward to.
chollida1 18y ago
This could actually be a boon to employees at Google as this may mean they have to start raising salaries. The same thing happened at Microsoft, Intel, Cisco and Adobe as they transitioned from growth companies to mature companies. Once they couldn't necessarily count on their rising stock price to act as part of their employee's compensation they started to raise salaries to help make up the difference.
- dmv 18y ago
  Also, restricted stock grants (like Microsoft adopted) look a lot better. Yes, it hurts to see your "potential grant" value decrease - a 50% drop is a 50% drop - but there is still absolute value (unless the stock becomes worthless).
huhtenberg 18y ago
> Google Employees Watch In Horror Feels like Digg.
ctkrohn 18y ago
Options don't become worthless when they're out of the money, as long as they haven't expired yet. The probability of the option being valuable at expiry is greater than zero, so the expected present value of the option is greater than zero.
- hugh 18y ago
  Indeed. If anyone has goog options that they think are "worthless" then I'll be happy to buy them at one cent each.
ckinnan 18y ago
I watch in horror as 60 percent of my 401k drowns.
iigs 18y ago
I don't know when their fiscal year ends, but having a drop right before review time means that when annual grant time comes around you're getting them at a lower price. Of course if the market is only going to go down-down-down then this is precious little consolation. Google moved into our area a couple years ago. When that happened the buzz in the tech job market was full of "I could go apply at Google". I remember, even at that point, having the feeling that the stock grants would probably be small and the potential for a stock price slide was really high. I would say with most tech companies if your employee number is less than 50 AND you have a high ranking position (manager plus) you might have a chance of having stock with a significant upside. Otherwise you're better off just getting the cash up front, in salary. Obviously Google was quite a bit larger and more successful, but post-IPO grants in technology are generally a joke.
- dcurtis 18y ago
  This is generally true, but I was under the impression that Google gave unusually generous grants as a form of compensation.
workpost 18y ago
This is happening to people in all sorts of industries.
known 18y ago
Current Share Price of the Company = 5 x Book value Per Share of the Company. Current Market Capitalization of the Company = 10 x Quarterly Revenue/Sales of the Company. Anything beyond this could be irrational or manipulation.
TweedHeads 18y ago
Tagged as propaganda and FUD.
kleneway 18y ago
One problem with options is the rift it may cause between people who joined the company while the stock was going up versus those who joined while the stock was going down. The people with the sinking options start to wonder why the guy next to them is leaving early each week to head out on his yacht, while you're stuck working extra hard to try to earn a 10% boost in your base salary next year. I believe Gates said something once about how offering options in the MS early years was one of his biggest regrets - exactly for this reason.

42 points by nickb 18y ago

329 is the magic number (of worthlessness) eh? 328.8 as of right now.

"The free food and transportation are great perks and all, but let’s get real here. Without the financial upside those stock options represent, Google employees will start looking elsewhere." Free food and transportation might be even more valuable now. Anyone that wants to work at a big company won't find better stock options and definitely not a better work environment. Anyone that wants to work in a startup environment was going to leave Google eventually. So no, Googler's won't be running for the door. I'd be interested to see how the internal market for reselling stock options looks right now.

nickb 18y ago
Forget about food and transportation... having a job will be the most valuable thing of them all. I doubt many Googlers will 'start looking elsewhere'... where exactly would they look? Dubai? China? Heh.
- tdavis 18y ago
  Exactly. I am no longer convinced that people actually think before writing TC articles.
  - omouse 18y ago
    TC has basically become part of the mainstream media then? That's a shame, I guess it's back to the Economist for me
    - mattmaroon 18y ago
      Did you ever find TC to be on level with The Economist, or even in the same ballpark? Or hell, even the same sport? TechCrunch does one thing very well, which is up to the moment headlines (on a rapidly changing industry) with just enough commentary that you can get a feel for what happened. It's one very small notch above a Twitter feed. If you're looking there for in-depth analysis, you're always going to be disappointed.
      - jumper 18y ago
        I dunno... I already wrote TC off as a waste of my time along with things like valleywag quite some time ago, so I could easily be ignorantly biased, but for me I'd describe them as mainly being "good" at link-baity bullshit titles + wild trollish theories about what could happen presented as fact press release style to stir up interest... I'm sure they have some value, but it all comes down to that magical signal-to-noise ratio question... and this article here doesn't appear so bad but also doesn't seem very good either....
        mattmaroon 18y ago
        Yeah, I don't know. I think TC is pretty good at giving you breaking startup news. I think you could pretty much read nothing but the headlines and get about 95% of full value out of it, while saving yourself about 90% of the time involved.
      - tdavis 18y ago
        If you're looking there for in-depth analysis, you're always going to be disappointed. Quite the contrary; I want TC to report start-up news. That's it. I don't want any editorials, op-eds, or analysis. Why? Because, as many many articles including this one prove, they are nearly always completely ignorant of the situation and say ridiculously stupid shit as a result. They do that well, as you said, but it's when they go beyond the bare necessities and actual facts into the realm of "analysis" that the writers (and editors and everyone else between an article and my face) fall flat on their asses and cause my blood pressure to rise in the process. "Shit, I can't swim. I know I can't. So you know what I do? I stay my black ass outta the pool."
- icey 18y ago
  Recognizing that probably none of us are old enough to have seen a downturn of this scale; the demand for quality talent didn't seem to diminish much in our other recent downturns.
- bigbang 18y ago
  "I doubt many Googlers will 'start looking elsewhere'... where exactly would they look? Dubai? China? Heh." Its not like Google is best company in the world(those days are gone). Even if, company doesnt matter to me,what matters is only the work(and the smartness of co-workers) what Iam doing. I would any day better compromise on the smartness of co-workers as opposed to compromising the quality of work. By this, there could be a lot of better jobs elsewhere.
- fallentimes 18y ago
  Agreed, but offering free food, transportation, health care, cell phone, etc is an awesome & possibly economical perk. Most of that stuff can be paid for with pre tax dollars as opposed to having to pay for it yourself with after tax dollars. The place I used to work paid for my phone, breakfast, daily lunches, insurance and metro card. My only fixed costs each month were groceries, dinner, rent, cable/internet, minor personal items & student loans.
goodkarma 18y ago
I thought they were cutting back on the free food etc.? Remember Sergey's comment about the M&M's and bottled water?

jcl 18y ago

On the bright side, I suppose, any new Google employees will have a bigger gain to look forward to.

chollida1 18y ago

This could actually be a boon to employees at Google as this may mean they have to start raising salaries. The same thing happened at Microsoft, Intel, Cisco and Adobe as they transitioned from growth companies to mature companies. Once they couldn't necessarily count on their rising stock price to act as part of their employee's compensation they started to raise salaries to help make up the difference.

dmv 18y ago
Also, restricted stock grants (like Microsoft adopted) look a lot better. Yes, it hurts to see your "potential grant" value decrease - a 50% drop is a 50% drop - but there is still absolute value (unless the stock becomes worthless).

huhtenberg 18y ago

> Google Employees Watch In Horror Feels like Digg.

ctkrohn 18y ago

Options don't become worthless when they're out of the money, as long as they haven't expired yet. The probability of the option being valuable at expiry is greater than zero, so the expected present value of the option is greater than zero.

hugh 18y ago
Indeed. If anyone has goog options that they think are "worthless" then I'll be happy to buy them at one cent each.

ckinnan 18y ago

I watch in horror as 60 percent of my 401k drowns.

iigs 18y ago

I don't know when their fiscal year ends, but having a drop right before review time means that when annual grant time comes around you're getting them at a lower price. Of course if the market is only going to go down-down-down then this is precious little consolation. Google moved into our area a couple years ago. When that happened the buzz in the tech job market was full of "I could go apply at Google". I remember, even at that point, having the feeling that the stock grants would probably be small and the potential for a stock price slide was really high. I would say with most tech companies if your employee number is less than 50 AND you have a high ranking position (manager plus) you might have a chance of having stock with a significant upside. Otherwise you're better off just getting the cash up front, in salary. Obviously Google was quite a bit larger and more successful, but post-IPO grants in technology are generally a joke.

dcurtis 18y ago
This is generally true, but I was under the impression that Google gave unusually generous grants as a form of compensation.

workpost 18y ago

This is happening to people in all sorts of industries.

known 18y ago

Current Share Price of the Company = 5 x Book value Per Share of the Company. Current Market Capitalization of the Company = 10 x Quarterly Revenue/Sales of the Company. Anything beyond this could be irrational or manipulation.

TweedHeads 18y ago

Tagged as propaganda and FUD.

kleneway 18y ago

One problem with options is the rift it may cause between people who joined the company while the stock was going up versus those who joined while the stock was going down. The people with the sinking options start to wonder why the guy next to them is leaving early each week to head out on his yacht, while you're stuck working extra hard to try to earn a 10% boost in your base salary next year. I believe Gates said something once about how offering options in the MS early years was one of his biggest regrets - exactly for this reason.