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Honestly I haven't seen anyone in this industry get any significant money, outside of investors and owners, since the dotcom days. Back then I knew quite a few

Honestly I haven't seen anyone in this industry get any significant money, outside of investors and owners, since the dotcom days. Back then I knew quite a few programmers that made a killing and still have money today from that era. Large money comes from ownership and the inherent risk. No one will ever give you enough money to go away completely as an employee. Can you make a little scratch? Of course. This industry pays very well. But if you want 500k and up in lump sums? Being an employee is never going to make it happen imho. And just for the record equity is not ownership. Go read up about all the maneuvers businesses can and will take to screw you out of your shares and you'll open your eyes. Businessmen don't give away anything they don't have to. Just a reality. If you can navigate that minefield you may one day be the outlier and get rich. But more likely you'll be fighting in court for years only to learn that well, you should've read the fine print. Don't get duped out here guys. Don't do this to get rich. Do this because you want to do it and everything else, with hard work, will fall into place.

markeroon 12y ago
Could you point me to some decent reading on the subject? I've asked around a bit but it's not really something that people like to talk about.
- loopbit 12y ago
  Perhaps not exactly what you are looking for, but a very good read on the subject is "Venture Deals" (http://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitalist/dp/1118443616 http://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitalis...). If you want to know exactly what rights your shares have (and don't have), this is the book.
tacos 12y ago
This is a side effect of companies filling coffers via investors instead of via customers. If you're part of a high growth company with reasonable earnings, that sales multiple means you'll likely get a taste of the action. If you're in a high growth VC funded company with no revenue, then that multiple goes to the VC and maybe one or two people they might like to work with again. You can restate this via all sorts of dilution and complex shareholder classes and endless paperwork and HN blogposts, but that's what it boils down to. Chances are you're in a no-growth or modest-growth company so none of this matters and you should read a basic business book from the 1960s instead, serve your customers well, and charge a reasonable fee for the goods and services you deliver.
- swingbridge 12y ago
  Indeed. If the company is a "real business" with actual customers and real profitable finances then those shares can be worth something. If it's all a bunch of VC backed fluff, well then good luck. At that point it's just a game of selling these virtual units to others wheeling and dealing in similar pumped up virtual fluff. There are lots of ways the 'options' holders get diluted and made irrelevant and are in effect just pawns that can be made to work for less cash based on the, mostly, pipe dream that these options will be worth something some day. One needs to be very careful if you're in this bucket.
  - fapjacks 12y ago
    Self-congratulating masturbatory financial recursion. That's the phrase I use.

markeroon 12y ago

Could you point me to some decent reading on the subject? I've asked around a bit but it's not really something that people like to talk about.

loopbit 12y ago
Perhaps not exactly what you are looking for, but a very good read on the subject is "Venture Deals" (http://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitalist/dp/1118443616 http://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitalis...). If you want to know exactly what rights your shares have (and don't have), this is the book.

tacos 12y ago

This is a side effect of companies filling coffers via investors instead of via customers. If you're part of a high growth company with reasonable earnings, that sales multiple means you'll likely get a taste of the action. If you're in a high growth VC funded company with no revenue, then that multiple goes to the VC and maybe one or two people they might like to work with again. You can restate this via all sorts of dilution and complex shareholder classes and endless paperwork and HN blogposts, but that's what it boils down to. Chances are you're in a no-growth or modest-growth company so none of this matters and you should read a basic business book from the 1960s instead, serve your customers well, and charge a reasonable fee for the goods and services you deliver.

swingbridge 12y ago
Indeed. If the company is a "real business" with actual customers and real profitable finances then those shares can be worth something. If it's all a bunch of VC backed fluff, well then good luck. At that point it's just a game of selling these virtual units to others wheeling and dealing in similar pumped up virtual fluff. There are lots of ways the 'options' holders get diluted and made irrelevant and are in effect just pawns that can be made to work for less cash based on the, mostly, pipe dream that these options will be worth something some day. One needs to be very careful if you're in this bucket.
- fapjacks 12y ago
  Self-congratulating masturbatory financial recursion. That's the phrase I use.