5 ms·

I would treat it as a lottery if I thought it was a lottery. But it isn't a lottery. If a startup _chooses_ not to go public then it I cannot realize any compe

by olliej 4y ago

I would treat it as a lottery if I thought it was a lottery. But it isn't a lottery. If a startup _chooses_ not to go public then it I cannot realize any compensation from that valuation - given the founders always seem to be able to, why isn't that option available to the rank-and-file employees? Similarly there have been multiple start ups that sold the controlling class of stock off and rendered all other stock worthless. A startup equity based compensation is only a lottery if the startup allows every employee who is being compensated with "equity" the opportunity to sell their "equity" back to the company at the current market valuation, or as part of the equity exchange in a funding round. Otherwise the value of the equity is determined by the company - what we're seeing here is that Stripe has realized that their scam compensation is running the risk of now actively harming their employees rather than just ripping them off. Stripe doesn't need to do any tax funding BS to "help" its employees: it just has to buy back the RSUs that are scheduled to expire at their apparent face value. The tax problem that employees are being faced with is entirely a result of stripe refusing to actually pay employees what they have earned.

danielmarkbruce 4y ago
This take isn't right. Stripe has done the right thing here. They've always been honest about what the comp was, what the risks were, and now they are doing the right thing, again. The employees involved recognize it as such and the only people making disparaging remarks are either not involved or don't understand it.
- runako 4y ago
  > Stripe has done the right thing here. Having worked for a company that (indefinitely) delayed its IPO, I can say that they may be doing the right thing today. But also there were plenty of observers who pointed out contemporaneously that there was no need for them to keep putting off the IPO. Sarbanes didn't put a $200B valuation floor on IPO registrants. I've never taken a company public, so I don't know their rationale for holding out. I do know that had they gone public as early as 2017, they still would have been roughly big enough to be listed in the S&P 500 (so not "small" by any definition that didn't explicitly reference Microsoft or Apple). Either way, their delay in filing likely deprived their early employees of some of the financial fruits of their joint labor.
  - danielmarkbruce 4y ago
    There is also no need for them to do it. Being a public market has downsides. They've been consistent with this message that they may well stay private forever. They never misled anyone. All the folks involved in this are grown adults. If people wanted to work a company which promised to go public, they'd have worked somewhere else. Again, the employees knew it, know it, and Stripe is now doing the right thing, again. Every step.
    - runako 4y ago
      > They never misled anyone Disclaimer: I don't have direct knowledge of any Stripe compensation plans. However, it is frequently noted (and this article touches on) the notion that Stripe comp plans are equity-heavy, in line with other big tech companies. That equity does not (to my knowledge) pay a dividend. Equity-heavy comp without a market for that equity and no dividend, in the context of a market where comp plans are equity-heavy with liquidity, is perhaps not a direct misrepresentation. But it is misleading, and I would bet that if they truly planned on staying private indefinitely (which: great!), they would have a mutiny on their hands if they didn't start paying a dividend or providing a market for the equity. Otherwise, folks have just been working for below-market rates to make the executive team rich. Which reads worse for the management team; I prefer the other interpretation that the leadership just erred in not going public (or selling) sooner.
      - danielmarkbruce 4y ago
        They said it could happen. It was all made clear. One can't reasonably claim to be misled when they are told explicitly before they join, when they join and continuously while they are there. In spite of all that, they are still doing the right thing by employees. Spinning this to suggest the founders were/are doing anything wrong by anyone is nonsensical.

by olliej 4y ago

danielmarkbruce 4y ago

This take isn't right. Stripe has done the right thing here. They've always been honest about what the comp was, what the risks were, and now they are doing the right thing, again. The employees involved recognize it as such and the only people making disparaging remarks are either not involved or don't understand it.

runako 4y ago
> Stripe has done the right thing here. Having worked for a company that (indefinitely) delayed its IPO, I can say that they may be doing the right thing today. But also there were plenty of observers who pointed out contemporaneously that there was no need for them to keep putting off the IPO. Sarbanes didn't put a $200B valuation floor on IPO registrants. I've never taken a company public, so I don't know their rationale for holding out. I do know that had they gone public as early as 2017, they still would have been roughly big enough to be listed in the S&P 500 (so not "small" by any definition that didn't explicitly reference Microsoft or Apple). Either way, their delay in filing likely deprived their early employees of some of the financial fruits of their joint labor.
- danielmarkbruce 4y ago
  There is also no need for them to do it. Being a public market has downsides. They've been consistent with this message that they may well stay private forever. They never misled anyone. All the folks involved in this are grown adults. If people wanted to work a company which promised to go public, they'd have worked somewhere else. Again, the employees knew it, know it, and Stripe is now doing the right thing, again. Every step.
  - runako 4y ago
    > They never misled anyone Disclaimer: I don't have direct knowledge of any Stripe compensation plans. However, it is frequently noted (and this article touches on) the notion that Stripe comp plans are equity-heavy, in line with other big tech companies. That equity does not (to my knowledge) pay a dividend. Equity-heavy comp without a market for that equity and no dividend, in the context of a market where comp plans are equity-heavy with liquidity, is perhaps not a direct misrepresentation. But it is misleading, and I would bet that if they truly planned on staying private indefinitely (which: great!), they would have a mutiny on their hands if they didn't start paying a dividend or providing a market for the equity. Otherwise, folks have just been working for below-market rates to make the executive team rich. Which reads worse for the management team; I prefer the other interpretation that the leadership just erred in not going public (or selling) sooner.
    - danielmarkbruce 4y ago
      They said it could happen. It was all made clear. One can't reasonably claim to be misled when they are told explicitly before they join, when they join and continuously while they are there. In spite of all that, they are still doing the right thing by employees. Spinning this to suggest the founders were/are doing anything wrong by anyone is nonsensical.