4 ms·

At the risk of being somewhat low value, "I am Jack's complete lack of surprise". I've been looking around in the job market recently. Seen plenty of startups

At the risk of being somewhat low value, "I am Jack's complete lack of surprise". I've been looking around in the job market recently. Seen plenty of startups with quite questionable business ideas (I am certainly not a savant, but have been heavily involved in product development and management) with statements like "we are early stage and are valued at $3B". Are you? Are you really? Or rather, you may be valued (and I realize I'm talking private, not public) at that, but are you worth it? All too often, the answer I come up with is "not really, no".

Havoc 3y ago
To steal fireship's joke "we're pre-revenue, pre-idea, pre-everything...1B val"
junofan 3y ago
> All too often, the answer I come up with is "not really, no". As an employee you get common stock, so multiply by 20% as a rule of thumb.
toomuchtodo 3y ago
If you’re not asking for a 409A or the most recent transaction demonstrating an arms length valuation, you’re getting taken for a ride. Make them prove it.
- Havoc 3y ago
  Recent transactions don't help if the entire sector is overvalued. Just tells you that you're aligned with the overval.
  - toomuchtodo 3y ago
    True and a fair point. Regardless, knowing the broad asset sentiment is good for how you’re investing fiat, knowing the single named private security valuation is good for how you’re investing your time.
- junofan 3y ago
  You want your 409a to be as low as possible without triggering an audit. This is not good advice.
  - toomuchtodo 3y ago
    You want all available information to be able to determine a fair EV imho (valuation information, shares outstanding, cap table, etc). Otherwise, you’re getting sold on equity value that is aspirational or outright inaccurate so the business can scrimp on cash comp.
    - junofan 3y ago
      A 409a is a very specific thing that proves nothing but timing and how good your provider was. For common stock, just multiply by 20% to get FMV.

Havoc 3y ago

To steal fireship's joke "we're pre-revenue, pre-idea, pre-everything...1B val"

junofan 3y ago

> All too often, the answer I come up with is "not really, no". As an employee you get common stock, so multiply by 20% as a rule of thumb.

toomuchtodo 3y ago

If you’re not asking for a 409A or the most recent transaction demonstrating an arms length valuation, you’re getting taken for a ride. Make them prove it.

Havoc 3y ago
Recent transactions don't help if the entire sector is overvalued. Just tells you that you're aligned with the overval.
- toomuchtodo 3y ago
  True and a fair point. Regardless, knowing the broad asset sentiment is good for how you’re investing fiat, knowing the single named private security valuation is good for how you’re investing your time.
junofan 3y ago
You want your 409a to be as low as possible without triggering an audit. This is not good advice.
- toomuchtodo 3y ago
  You want all available information to be able to determine a fair EV imho (valuation information, shares outstanding, cap table, etc). Otherwise, you’re getting sold on equity value that is aspirational or outright inaccurate so the business can scrimp on cash comp.
  - junofan 3y ago
    A 409a is a very specific thing that proves nothing but timing and how good your provider was. For common stock, just multiply by 20% to get FMV.