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There is an enormous difference between paper money and real, liquid money. There is an enormous difference between the headline price an investor invests at,
by erdevs 12y ago
There is an enormous difference between paper money and real, liquid money. There is an enormous difference between the headline price an investor invests at, with all their Preferred rights, and what an employee can actually cash out at.
There are very, very few cash exits of $1B+ in any given year. And far less than the majority of those have rights that allow employees, or even founders, to cash out at, for example, the sky high initial IPO market cap pop price.
- ganeumann 12y agoWell, sure, but the referenced paper mentioned "net worth", not cash. I assumed they were ignoring people whose net worth included hard to value private company stock.
- erdevs 12y agoYes, but that's kind of my point. I was replying to people speculating that SF must have more than ~526 people with liquid net worth above $30M. 526 doesn't seem a low estimate to me. Unless your counting unrealized paper Gaines... Before tax, and which often do not pan out upon liquidation the way a naive reading would imply they will on paper.