[HN Gopher] Understanding Startup Offers
       ___________________________________________________________________
        
       Understanding Startup Offers
        
       Author : medtner
       Score  : 107 points
       Date   : 2021-09-24 16:30 UTC (6 hours ago)
        
 (HTM) web link (withcompound.com)
 (TXT) w3m dump (withcompound.com)
        
       | bruce343434 wrote:
       | Addendum: Understanding _American_ Startup Offers
        
       | sys_64738 wrote:
       | Moral of story: avoid startups.
        
       | synergy20 wrote:
       | Chatted with some early-stage-then-IPO-ed engineers yesterday, I
       | asked "aren't your company IPO-ed and you should have retired?",
       | the answer is, after multiple dilutions in rounds of fund raises,
       | his options ended up worth just a few thousands, not useful at
       | all.
       | 
       | There is no way the startup you have been working for will keep
       | your interest a priority, and you never know if your share will
       | reach zero in the process of multi-stage VC rounds.
       | 
       | Unless you're the founders who will always be at the negotiation
       | table for new rounds, I saw no point to work for startups, not at
       | all.
        
         | clpm4j wrote:
         | I think the main advantage of working at a startup is when
         | you're relatively young and inexperienced - you're being
         | compensated in the experience and accelerated job titles that
         | you can then leverage to ramp up your career by joining other
         | companies or starting your own. Getting an exit is a cherry on
         | top.
        
           | dhd415 wrote:
           | In my experience, getting a FAANG job accelerates your career
           | as well or better than titling up quickly in a startup.
           | Having a FANG position on your resume is more of a known
           | quantity for future potential employers than being promoted
           | quickly in an unknown startup.
        
             | glassconclusion wrote:
             | I'm working for an unknown startup and I feel like I will
             | placed in a pool of entry level candidates if I decide to
             | join a big corp.
        
               | dhd415 wrote:
               | I would expect that your startup experience would place
               | you well among a pool of entry-level candidates once you
               | made it past the resume screening stage. Where the FANG
               | position is going to help you is in getting past that
               | stage. Fairly or unfairly, having a FANG position on your
               | resume is kinda' like having a degree from an elite
               | university in that recruiters will view your resume more
               | favorably.
        
           | freewilly1040 wrote:
           | I don't think people at established companies care about
           | gaudy job titles at startups. Being a director at some
           | chaotic mess of a company (and much of the time that is what
           | startups are) doesn't signal competence.
           | 
           | The opposite can be true, when IC's at startups who have not
           | truly learned their craft jump to management too early.
        
             | clpm4j wrote:
             | Yeah true I suppose there was some bias in my assumption. I
             | was thinking specifically about relatively well known Bay
             | Area startups... say you're a Senior or Staff Engineer at a
             | startup that has raised from top tier VCs then
             | hypothetically you might be better positioned to be come
             | that #1 or #2 engineering hire at the next hot startup, or
             | you'll be able to get more meetings with those VCs should
             | you start your own thing because you're already a "startup
             | person" rather than 1 of X00,000 FAANG engineers.
        
           | majormajor wrote:
           | I don't think startup job titles are worth much but they can
           | be massive skill accelerators.
           | 
           | If you're in the first 5 years of your career you'll have
           | more opportunity to learn more technologies at a small
           | startup where everyone has to do everything than at a FAANG
           | (especially compared to Google where you will only learn the
           | Google internal stack).
           | 
           | You can leverage that into a much higher paying job in a way
           | that you wouldn't be able to leverage experience at a mid-
           | level company.
        
           | Hermitian909 wrote:
           | Even this is becoming less valuable as bigger companies start
           | to invest in training and mentorship.
           | 
           | Three people I know how graduated college recently working at
           | big companies have senior engineers dedicating multiple hours
           | a week to mentorship and a lot of learning opportunities.
           | They're growing much faster than junior engineers thrown into
           | the deep end IMO.
           | 
           | The faster title advancement doesn't mean much IMO. Working
           | at a big company I can say that outside of a certain group of
           | other big companies we just don't trust titles to have any
           | correlation to abilities.
        
         | [deleted]
        
         | ctvo wrote:
         | > _Chatted with some early-stage-then-IPO-ed engineers
         | yesterday, I asked "aren't your company IPO-ed and you should
         | have retired?", the answer is, after multiple dilutions in
         | rounds of fund raises, his options ended up worth just a few
         | thousands, not useful at all._
         | 
         | Assuming series a engineering role, .30 - .50%, even after
         | dilution, for an IPO'd company, we're assuming 1BN+, to walk
         | away with a "few thousands" is hard to calculate.
         | 
         | A few hundred thousands is more likely (taxes) and even that
         | isn't a worthwhile trade-off for most folks. It'd need to be in
         | the millions to make it more attractive than big tech at the
         | moment.
        
       | bbno4 wrote:
       | Is there one of these but for UK?
        
       | keeptrying wrote:
       | These set of questions are very thorough and will help you avoid
       | 80% or more of the bad situations. I had to figure out all thsi
       | on my own and most startups won't answer these questions even
       | after getting an offer.
       | 
       | Some more question you might want to ask: - is there a double
       | trigger clause? (If not then the founder can restart your vesting
       | after an acquisition and do other nasty things.)
       | 
       | - can I exercise my options after beating while I'm at the
       | company. (You'll be surprised but I've seen companies that don't
       | allow you to exercise while you're employed there which means you
       | can kiss qsbs goodbye and you can't leave comoany if it gets too
       | big else you'll lose the options)
       | 
       | - can I sell my exercised stock on the secondary market? (Some
       | companies don't allow this)
       | 
       | 95% of people don't ask these questions and can get screwed.
        
       | fasteddie wrote:
       | This is a great, clean explainer.
       | 
       | Series B seems to be the sweet spot to me if you would like to
       | avoid working at a FAANG but want similar EV in your comp
       | package, assuming you are decently good at guessing winners.
       | 
       | At that point the company is meaningfully de-risked but the
       | equity offers are still pretty good for mid-career folks that you
       | end up with millions in a good exit.
        
         | xtracto wrote:
         | I've come to prefer post-Series A startups. In my experience
         | Series B tended to be the moment where the startup beings to
         | establish "controls" and bureaucracy for things. It is when you
         | start setting OKRs, it is when you start having 2 or more tiers
         | of mid-management and "policy documents" start flying around.
         | 
         | For me, post Series A is the sweet spot when there are exciting
         | problems to solve and you still have good leeway to make things
         | happen without too much red tape.
        
       | lankinen wrote:
       | Great post!
        
       | toomuchtodo wrote:
       | It would be helpful to explain how an early employee (whether
       | still employed or separated from the company) is able to obtain
       | the following documentation from their company to demonstrate
       | QSBS treatment to the IRS (or if a letter indicating such from a
       | finance department or the CFO would suffice):
       | 
       | > Even though reporting QSBS is simple, you should still keep
       | financial statements and other supporting documents to support
       | your claim. Detailed balance sheets for the company from its
       | incorporation through the close of your investment will show if
       | it has more than $50 million in aggregate gross assets. Equity
       | documents (type, date, etc.) are also important to demonstrate
       | that your investment qualifies. [1]
       | 
       | [1] https://withcompound.com/manual-company-equity/qsbs
        
         | ganoushoreilly wrote:
         | This is a good point. A lot of founders seem to want to protect
         | or hide this information. Usually that's a red flag for me, but
         | it's common. I think it needs to me more normalized and
         | formalized.
        
           | [deleted]
        
       | rdli wrote:
       | The post says "an alternative career accelerated through
       | learning, wealth, and reputation" ... and then doesn't talk about
       | anything other than equity.
       | 
       | The article says "Equity will be your largest driver of
       | compensation at a startup." as the rationalization of why it
       | focuses on that.
       | 
       | Based on my past experiences, I would say that the learning,
       | network, and reputational effects resulted in far more wealth to
       | me over the medium-term than any incremental change in equity or
       | salary.
        
       | qqtt wrote:
       | It would be interesting to see some analysis comparing pre-IPO
       | offers versus standard FAANG-style engineering offers and see
       | what the monetary difference actually is.
       | 
       | In the not-so-distant past, start ups were pretty much the only
       | avenue to secure a multiple-million dollar personal liquidity
       | event, in the off chance you join a successful start up, work
       | your tail off, and the company gets to a point where that exit
       | happened (which was and still is rare).
       | 
       | But nowadays, with software development offers being what they
       | are are large public companies with outstanding growth prospects,
       | the argument that you need to join a start up to fast track
       | earning millions is pretty much out the window. Not only do
       | people who are working at large stable companies like Google &
       | Facebook have the generous perks and large company work life
       | balance stability behind them - they are also soundly beating
       | almost all "successful" start up offers in terms of compensation
       | over the long term.
       | 
       | I would love to see some real life practical numbers with start
       | up offers at different stages of funding and how that would
       | really compare to simply working at Google or Facebook over the
       | same time horizon.
       | 
       | It seems the only reasons to work at a start up these days are if
       | you really really love building products, want to wear many
       | different hats, are frustrated by the pace of big companies, and
       | are stifled by the big company processes that dominate the day to
       | day life working at these companies.
       | 
       | Compelling reasons to work for a start up for sure, but
       | compensation is not even in the top 10 reason to join a start up
       | anymore, IMO.
        
         | joshuamorton wrote:
         | Dan Luu wrote about this a few years ago:
         | https://danluu.com/startup-tradeoffs/ (from 2015, but has been
         | updated a bit since then).
         | 
         | I think the big challenge is that accurately evaluating a
         | startup offer is very, very difficult. And it can be really,
         | really contextual. As an example, I know someone who worked at
         | a company that went public fairly recently, and their result
         | was vastly worse than the EV of a big company, but they also
         | had a below average startup EV because they left the company
         | and didn't purchase all of their options when they left.
         | 
         | With Google or Facebook, the question is really just stock
         | growth and grant sizes.
         | 
         | With startups its growth and grant sizes, yes, and the expected
         | type of liquidity event(s) and the time horizon on that event
         | and your plans and company culture over that time horizon, also
         | any additional funding rounds can markedly affect things and...
        
         | enra wrote:
         | The challenging part about equity that every company is
         | different, takes bit different path and has different chances
         | of success.
         | 
         | My anecdotal example that I don't know anyone who made
         | massive/post-economic money by joining a public company. You
         | can probably make six figures easily, and potentially low 7
         | figures in some years. The only people I know who have mode 8
         | or 9 figures are people who have joined startups early or
         | relatively early before the IPO, and the startup became a
         | $20-100B company.
         | 
         | Seed stage, as one of the first senior engineers, you might get
         | 2%-0.5% equity. At $20M valuation (common YC valuation at the
         | moment). That's $400k-100k value vesting over 4 years (which
         | might sound low compared to FAANG offers). The point is the
         | upside potential, not the value. FAANG companies might grow 5x
         | in 5 years. Startups can grow much more. That's why the whole
         | VC market exists.
         | 
         | Hitting $1B means the company valuation went up 50x, hitting
         | $10B means 500x, hitting $100B means 5000x. So your initial
         | offer could be worth several millions to hundreds of millions.
         | Even if you join later, when the company is valued $500M-$1B,
         | you might still get 50-100x upside.
         | 
         | The math is more complicated since usually companies raise
         | multiple rounds which then dilutes the existing shareholders.
         | Roughly 20% at seed/series a, and then less after that.
        
           | qqtt wrote:
           | With things like dilution mattering and stock options being
           | popular vehicles for early stage start up it would be really
           | interesting and elucidating to have practical examples to
           | compare against.
           | 
           | It's easy to understand a FAANG style offer in this context.
           | 
           | You join Google in 2017, you get RSUs pegged at 800$ a share
           | valuation, about 150k$ a year vesting, by 2021 those shares
           | are worth 2800$ so you've earned about 2.1 million (not
           | exactly as taxes come into play).
           | 
           | You join AirBNB in 2017, valued at 30 billion, you get a
           | similar offer, fast forward to today and AirBNB is now worth
           | 100 billion, you might have made 2 million (again, not
           | exactly, considering taxes and potential dilution). And
           | AirBNB is one of Y Combinator's most successful start
           | ups/exits.
           | 
           | From some quick google searching - there are thousands of Y
           | Combinator companies and only ~29 are worth one billion or
           | more. Of those billion, they are all at this time late stage
           | and trying to guess which up and coming Y Combinator company
           | will be next to crack 1 billion is a very risky endeavour.
           | 
           | How does the tax implication of stock options really impact
           | your net gain, and does that practically move the needle for
           | a comparison against a standard FAANG offer?
           | 
           | Would be interesting to look at some cold hard numbers.
           | Absolutely joining a 20M valuation YC company and sticking
           | around until it grows to 1B would be incredibly lucrative -
           | but how lucrative in a practical sense, given real offers?
           | Dilution? Tax implications? Would love to see this analysis.
        
             | preseedthrwwy wrote:
             | throwaway for obvious reasons..
             | 
             | I joined a seed company w/ a $10m valuation in early 2014,
             | starting offer was 1%. after series a, b, c, and some
             | smaller retention grants, I had about 0.4%. Left before
             | fully vesting, so ended up with 0.3%. Company was acquired
             | for $4b and I made $12m. After taxes, netted about $7.5m
             | 
             | Joined another seed company with $10m valuation in 2016,
             | starting offer was 3%. after a few dilutive funding rounds
             | and some generous retention grants, ended up with 1.2%.
             | Company also acquired for $4b and I made $50m. Will
             | probably have about $35m from this one after tax.
             | 
             | Obviously I was _incredibly_ lucky in picking those two
             | companies, but maybe those numbers shed some light on
             | dilution, taxes, etc. I wouldn't have made anywhere near
             | that much if I'd joined those companies after series a, let
             | alone b or c. I encourage anyone I know who wants to make 7
             | figures to work for faang for a few years. If they want to
             | make 8 figures, start a company or join as the very first
             | hire (as I did) if you're not willing to take the risk of
             | being a founder.
        
               | lostdog wrote:
               | Wow! What companies do you like right now ;)
        
               | clpm4j wrote:
               | This is a good 'best-case' example that anyone could hope
               | for, and like you say - you probably need to be one of
               | first few engineering hires to have a shot at this type
               | of outcome.
        
               | preseedthrwwy wrote:
               | absolutely agree - wasn't trying to give the indication
               | that I think my situation is a likely outcome
        
               | quokkafriend wrote:
               | What is next for you?!
        
               | quokkafriend wrote:
               | Yea I think this is a top 0.1% survivorship bias. Hitting
               | 2 startup lotteries in a row at that kind of exit. Kudos.
        
               | glassconclusion wrote:
               | Shouldn't be this more like 0.01%? Two startups as an
               | early employee and hitting almost 50M. Wow. just wow.
        
               | devnulll wrote:
               | I bet this goes the other way, especially at the exec
               | level. That is, the best indicator of startup success is
               | past startup success. Certainly funding is easier,
               | building the team is easier, and the emotional decision
               | making is easier.
               | 
               | The phrase serial entrepreneur is often used.
        
             | enra wrote:
             | Yeah I wish YC or someone could provide some anonymized
             | data on this across companies. And it's true that out of
             | all startups, only probably 1% make it big. But the markets
             | are growing fast and just this year there has been ~200 IPO
             | which I think mostly are $1B+.
             | 
             | From a tax perspective, RSU are probably worst. They are
             | taxed on your W-2, effectively a bonus. If you make a lot,
             | you pay max bracket federally and in your state. In
             | California I think it can be ~54%.
             | 
             | Joining seed/pre-seed company that hasn't done a priced
             | round likely is the best. Employees get to buy shares, not
             | options, at the nominal price, often $0.0001 per share.
             | There is no taxes as there is no gain. After a year those
             | turn in to long term shares, and you can hold them forever
             | without paying any taxes. When the company is public, you
             | can borrow money against it so you don't have to sell. If
             | you sell, you pay long term capital gains, and if QSBS
             | still exists and you hold the shares for 5 years, you have
             | $10M tax free federal credit.
             | 
             | With options, it depends on the timing and the cost to
             | exercise. Joining early, and exercising options early, is
             | usually also good since now you own the shares and only had
             | to pay the fair market value which is 20% of the investor
             | valuation. Again now you can hold the shares forever, get
             | QSBS or pay long term capital gains when you eventually
             | sell.
             | 
             | If you join late, likely you should still exercise if you
             | can/want to. If you don't exercise early, then you might
             | have to pay taxes on the gains of the fair market value
             | from the time you were granted the options and the time you
             | exercised. Or you could just hold the options if the
             | company allows. Then after the company is public you can
             | just exercise and sell, and pay the short term capital
             | gains similar to RSU.
        
               | freewilly1040 wrote:
               | I think YC has not put out information like this because
               | the data would show joining a startup as a regular
               | employee is not remotely worth it vs publicly traded
               | companies.
        
               | [deleted]
        
           | [deleted]
        
         | nostrademons wrote:
         | "In the not-so-distant past, start ups were pretty much the
         | only avenue to secure a multiple-million dollar personal
         | liquidity event"
         | 
         | I'm actually not sure this is true, and wondering if this was
         | reporting bias. When a startup exits for a billion and all the
         | employees get rich, you hear about it on the news, and you can
         | do the equity calculation yourself based on public funding
         | round press releases. When a big company quietly gives a multi-
         | million-$ comp package to a valued employee, they have _zero_
         | incentive to share that news with the rest of the world.
         | 
         | My wife grew up in Silicon Valley, and somehow all of her
         | friend's parents have large real estate holdings. These were
         | people active in the 70s-90s, big company employees, no exits.
         | But there was one guy who had a beautiful house in the Saratoga
         | foothills with an artificial waterfall between his two swimming
         | pools; "Oh, his dad was a rainmaker at Intel." Or another
         | friend of the family who had made some key inventions at HP,
         | and retired early. Or the innkeeper we met in Alaska who had
         | simply worked big companies in Silicon Valley, no exits, saved
         | his money, but then when he turned 40 he bought a sailboat,
         | sailed around the world with his family, then when he reached
         | Alaska bought 2 old warehouses and converted them into a B&B.
        
           | noodle wrote:
           | I think it's true if you add the caveat "only avenue for an
           | average person". Not everyone gets the big liquidity event in
           | the startup game, but also very few people actually get
           | multimillion dollar comp packages at well established post-
           | IPO companies despite how much it seems to get discussed
           | here.
        
             | nostrademons wrote:
             | The startups that succeed do not generally have average
             | early employees. Remember that founding a startup and
             | successfully taking it to a large exit is a decidedly non-
             | average outcome; the average startup fails miserably.
             | 
             | I think that if you're seeking non-average wealth you
             | should first strive to be non-average. There are a number
             | of pathways to exceptional wealth, but all of them require
             | being exceptional in some way.
        
         | esonderegger wrote:
         | One of the things I rarely see mentioned when discussing career
         | prospects of startups vs large corporations is how different
         | their hiring filters are.
         | 
         | If you are self-taught, lacking credentials, and don't live in
         | a major market, it can be difficult to get in the door at a
         | FAANG. Whereas start-ups can be much more likely to take a
         | chance on someone with a non-conventional background.
         | 
         | So for some of us, large corporations aren't even an option
         | until after we've taken that startup job and the startup has
         | done well enough that people have heard of it.
        
           | ctvo wrote:
           | > _If you are self-taught, lacking credentials, and don 't
           | live in a major market, it can be difficult to get in the
           | door at a FAANG. Whereas start-ups can be much more likely to
           | take a chance on someone with a non-conventional background._
           | 
           | Don't self select out of these jobs. I've been an interviewer
           | at FAANGs. We take talent where we can and count ourselves
           | lucky.
           | 
           | Our recruiters call everyone given enough time. Reach out to
           | one directly on LinkedIn for an even better chance at an
           | initial screening call. Ask for a referral from someone
           | already working there in your wider network. Ask for a
           | referral from Blind. Ask for a referral from HN.
           | 
           | From there it's your ability to pass the interview, not any
           | set of credentials (different thread please on the interview
           | process).
        
           | leetcrew wrote:
           | I just went through the job search again, and I found the
           | exact opposite to be true. for context, I went to a
           | regionally-known (at best) state university and have just a
           | few years of experience at a small company you've probably
           | never heard of. so not quite "self-taught" but pretty far
           | from what you'd think of as a the typical FAANG employee.
           | 
           | I applied to at least twenty roles at startups and
           | small/medium-sized companies that seemed like a good fit for
           | my skills and wrote thoughtful cover letters for each one.
           | not a single one of those employers responded, not even to
           | reject.
           | 
           | I also applied to a couple FAANGs, thinking it was a pretty
           | long shot. but I ended up getting two on-sites, one of which
           | I converted to an offer. there's definitely some truth to
           | what people say about the unreasonable/irrelevant DS/algo
           | problems, but I found it comforting to know for once what I
           | was actually being assessed on.
           | 
           | not sure whether I got lucky with the FAANGs, unlucky with
           | the smaller companies, or what, but just thought I'd share
           | that anecdote. not the outcome I was expecting at the
           | beginning of the process.
        
         | quokkafriend wrote:
         | My equity grants as a non-eng (but involved in prod dev) have
         | ranged from 0.05% to 0.6% over the course of 10 years in
         | startups (age 25-35). All Series A to Series B.
         | 
         | My take is that unless you are very good at judging leadership
         | teams and company prospects, that joining a FAANG or a Series
         | C+ scale-up (and even that takes thoughtful research and luck)
         | is the better play.
         | 
         | Early stage at my past grant levels has to hit a unicorn
         | valuation for the equity to match FAANG packages. I'm not even
         | sure a $1B exit is enough after dilution, investor preferences,
         | and god forbid down/flat rounds. Certainly not at the grants
         | that I started at in my career.
         | 
         | Plus keep in mind that FAANG stock also appreciates. I see some
         | folks not accounting for that growth and only startup valuation
         | growth. Comp packages for mid level ENG and PMs are 400-500k /
         | yr, not even including appreciation!
        
           | hinkley wrote:
           | Maybe it's like people using their tax refund as a savings
           | strategy. If you're good with your money then fixing your
           | withholding and increasing your savings rate nets you more
           | money in the long term. But you have to have self control to
           | save the money instead of just fighting temptation once a
           | year.
        
           | akomtu wrote:
           | A typical 4-year vesting plan at 500k/year gives 2M in
           | "nominal" dollars. 2x that to account for stock market
           | growth, 2x for work life balance (startups demand 2x more of
           | your time than FANG), 3x for dilution and other startup
           | shenanigans, 5x for the risk (how many C series get bought
           | for 1B within 5 years?), and you need a 60x2M offer from a
           | startup to just match FANG. 120M looks outrageous only
           | because it's fake money: 95% of the time you won't get
           | anything.
        
           | fatnoah wrote:
           | I spent the better part of 17 years at startups, with grants
           | ranging from 0.2% all the way to 1% (VP Eng in a Series C+).
           | The latter exited, but options were worth $0 due to
           | liquidation preferences. I did get a cash bonus equal to
           | about 2x my salary, so that was nice...it was also about the
           | same as the sum of my last two stock vests (i.e. 6 months) at
           | the FAANG I'm currently at, and whose stock price has doubled
           | since I joined. I currently make 4X what I made at the height
           | of my startup career.
           | 
           | Unless I'm coming in hot with good equity and an imminent IPO
           | OR I don't need/want the money at all, I can't see going to
           | back to startup life. (I also wouldn't trade that startup
           | experience away, either)
        
             | hinkley wrote:
             | I learned long ago that the most successful tech company I
             | know is probably not the one I work for. Also that layoffs
             | tend to follow drops in the stock price.
             | 
             | I don't buy shares on margin, so why would I want my nest
             | egg invested in the company I work for? If I get laid off
             | I'm poor twice over.
        
         | jdavis703 wrote:
         | I don't know about Facebook, but my friends at Google seem to
         | have terrible work life balance. Seems like they only get a
         | breather when they're between projects.
        
           | nostrademons wrote:
           | Google in general has pretty good work/life balance.
           | 
           | I think the challenge is that you're responsible for
           | _launching_ on a feature team at Google, and the lead up to a
           | launch has a ton of work that needs to be done often under
           | tight deadline pressure, plus the codebase is crazy complex.
           | If you 're a self-motivated, detail-oriented, slightly
           | obsessive individual of the type Google loves to hire, you're
           | not going to rest until it's all done.
           | 
           | Infrastructure/logging/analysis/reliability teams have it
           | much better at Google, in terms of work-life balance, but the
           | tradeoff is that it's harder to justify your impact when it
           | comes to promotion time.
        
             | joshuamorton wrote:
             | This, I've basically never felt external pressure from
             | management or deadlines in my job.
             | 
             | I have however, on more than one occasion, found myself up
             | far too late (or in the pre-pandemic times having nearly
             | missed the last bus home) because _I just want to figure
             | out what is causing this damn bug_. It could wait until
             | tomorrow, no one would care if I waited until tomorrow,
             | there is no pressure for me to fix it today. But I want to
             | solve the problem.
        
       | mcgingras wrote:
       | I have an offer that vests over 6 years with a 1.5 year cliff. Is
       | that normal? I'm used to 4 years 1 year cliff, but the CEO said
       | that 1.5/6 are common for companies that "want employees who care
       | about the long term"
        
         | majormajor wrote:
         | No, have had multiple recent better offers than that. They're
         | trying to rip you off.
         | 
         | If they want to keep you motivated for the long term even if
         | value isn't increasing rapidly then they can do bonuses,
         | refreshers, etc.
        
         | [deleted]
        
         | matheist wrote:
         | I've never heard of 1.5/6 being a thing. Would be a red flag
         | for me but of course I only have the context you mentioned.
         | 
         | Refresher grants could also motivate employees to stick around
         | for the long term!
        
         | devnulll wrote:
         | No, I don't believe that's normal. That sounds like a CEO
         | trying to take advantage of the labor force.
        
           | mcgingras wrote:
           | Thanks everyone, that's what I was thinking as well, but I'm
           | fairly new to startups so I wasn't sure.
        
             | xtracto wrote:
             | Mhmm, I wouldn't put it like GP (someone wanting to take
             | advantage of...). The large majority of employments DO NOT
             | give stock options. Shit, in most countries that's unheard
             | of (in Mexico for example, someone with a similar offer
             | would think of the stock options as the cherry on the
             | cake).
             | 
             | Nonetheless, given YOUR market, you should check whether
             | the other parts of the compensation they are giving you are
             | right. For example, there was the case of Mailchimp a
             | couple of days ago: They gave no stock to their employees.
             | However, in theory their compensation package was good in
             | other ways. So if the company is offering you a good salary
             | + benefits (what about 401k matching? PTO? sick days? gym
             | membership, WFH and whatnot), that will give you the full
             | picture.
        
         | freewilly1040 wrote:
         | 4 year vest, 1 year cliff is the standard, and even that is
         | going away at some places.
         | 
         | An employer who wants to keep you will demonstrate that by
         | compensating you well and giving you an opportunity to augment
         | your skills.
         | 
         | This offerer sounds like someone who has experienced turnover
         | problems and has decided that it's everyone else's fault.
        
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