5 ms·

You are partly right, but in Facebook's case the stock price is important for a few reasons: (1) public perception: FB is a media/advertisement related company,

You are partly right, but in Facebook's case the stock price is important for a few reasons: (1) public perception: FB is a media/advertisement related company, and it is not good to be viewed by the public as a sinking ship; (2) employee retention: tech companies rely on stock grants to attract talent. With a stock price that is getting lower by the day, there is less incentive for employees to join the company.

nuclear_eclipse 14y ago
Stock grants were the last thing that attracted me to my position at Facebook. Their other benefits, and especially the workplace environment itself [1], are far more desirable to me than stock grants, especially when the salary range is already extremely competitive. 1: https://www.facebook.com/careers https://www.facebook.com/careers
nchuhoai 14y ago
Agreed on (1), non-tech people continously reference the stock price totally unrelated (sigh), but for (2), they have 10 billion more to pay, right :)
atirip 14y ago
(1) So your advice would be to cancel my (potential) very effective marketing campaign in FB because it's stock is sinking? Or should I reduce my personal activity? Or what?
- jeltz 14y ago
  No, but people without any successful campaigns (they either never have had a FB marketing campaign or their last one failed) will get doubts about if FB is the right venue. I personally think stock price is a bad proxy, but many people still look at it.
bradleyjg 14y ago
They raised $3 million per employee. They have plenty of ability to offer the very best kind of compensation - cold, hard cash.
- spiffage 14y ago
  The reason tech companies rely heavily on stock-based incentives is to align the interests of the employee with the shareholder. You want the group to have a shared fate. Cold, hard cash, while attractive to people who haven't yet joined, doesn't align interests as well as stock does.
  - bradleyjg 14y ago
    They can always take the upthread suggestion of repricing options, or issuing RSU. I'm really not seeing any employee downside other than some punctured dreams - and I don't see how those dreams would have been any less punctured if they had IPO'd at $10 and moved to $18.
    - Evbn 14y ago
      Employees would have negotiated for more shares at the $10 price.

nuclear_eclipse 14y ago

Stock grants were the last thing that attracted me to my position at Facebook. Their other benefits, and especially the workplace environment itself [1], are far more desirable to me than stock grants, especially when the salary range is already extremely competitive. 1: https://www.facebook.com/careers https://www.facebook.com/careers

nchuhoai 14y ago

Agreed on (1), non-tech people continously reference the stock price totally unrelated (sigh), but for (2), they have 10 billion more to pay, right :)

atirip 14y ago

(1) So your advice would be to cancel my (potential) very effective marketing campaign in FB because it's stock is sinking? Or should I reduce my personal activity? Or what?

jeltz 14y ago
No, but people without any successful campaigns (they either never have had a FB marketing campaign or their last one failed) will get doubts about if FB is the right venue. I personally think stock price is a bad proxy, but many people still look at it.

bradleyjg 14y ago

They raised $3 million per employee. They have plenty of ability to offer the very best kind of compensation - cold, hard cash.

spiffage 14y ago
The reason tech companies rely heavily on stock-based incentives is to align the interests of the employee with the shareholder. You want the group to have a shared fate. Cold, hard cash, while attractive to people who haven't yet joined, doesn't align interests as well as stock does.
- bradleyjg 14y ago
  They can always take the upthread suggestion of repricing options, or issuing RSU. I'm really not seeing any employee downside other than some punctured dreams - and I don't see how those dreams would have been any less punctured if they had IPO'd at $10 and moved to $18.
  - Evbn 14y ago
    Employees would have negotiated for more shares at the $10 price.