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> You sell your options back to the company at the current market rate -- the rate at which that most recent investors purchased equity. Why should the "market
by xtrumanx 12y ago
> You sell your options back to the company at the current market rate -- the rate at which that most recent investors purchased equity.
Why should the "market rate" determined by the most recent round of investments? A lot could have changed since then.
> If the company doesn't want to buy them, you _should_ be free to sell to others. Restrictions in _those_ cases would be worth writing about.
The issue isn't having to sell back to Uber but having to sell it at Uber's price.
- robbiemitchell 12y agoIt's true that a lot could have changed since the previous investment round, but isn't that often the case in venture capital funding? Paying a different price for one person's equity changes the valuation for everyone as the new market rate. This can be bad for an individual (could be sold for higher on private market) but also good (prevents someone else from selling at a major discount). Companies want to control valuation much more closely than that, so valuation is pegged to investment or some other major event. Whether that's a good way to do things would be a nice discussion topic, but that's not the same as saying uber in particular is playing hardball. A little bit of research would reveal that it's standard practice.