milktoast wrote: ↑Fri May 28, 2021 11:19 amI've hired into mega-tech, pre-IPO (successful IPO), angel round startup (now pre-IPO unicorn), seed round startup, and a couple in between (post-A and post-B).
From my perspective, management and venture capital wised up after the very early nineties experience at Microsoft with low level workers making a lot from their options.
See AlsoHow NASDAQ IPOs WorkWhen tech companies go public, employees can strike it rich — or not. And then the trouble startsIt seems like everyone tries to hit market value now. Mega-tech pays your market value in salary/bonus/RSU. The earlier a startup is, the less salary you get (never bonus) and options go up. But it seems like the options are essentially trying to hit a formula of market_value = salary + value_of_options_at_successful_ipo * chance_of_successful_ipo.
So joining right before an IPO means the chance of successful IPO is high. So the salary will go up and options will go down compared to earlier rounds. Less potential downside, less potential upside for the employee.
If you are a VC investing in tens of startups it all averages out to paying market rate. If you are the employee, you don't get to play averages. Some win some lose.
Mostly agree except on the bonus front.
I joined a startup that had just completed series C funding when I joined. About 20% of my OTE is bonus. I started at the beginning of the 4th quarter and the company had such an excellent year that even though I was only there for 3 months, I received the bonus I would have gotten for the full year.
In addition to base and bonus I received options, but it’s hard to say what they’re worth since were pre-ipo
Since I joined almost 2 years ago, the company became a unicorn, and has now greatly exceeded that status. All signs point to a successful IPO in the future but who knows what will happen between now and then.
When I joined the company, I was employee 350 or something like that. It was in the 300s. Based on what some of our recent valuations have come in at and how similar companies performed post IPO, I’m going to venture to say my options will be worth a few hundred thousand dollars if and when an IPO happens.
That’s about as specific as I could get because the future is unknown but I hope this is helpful to you.
Side note, I love working for this company and being in a high growth pre-ipo environment is a lot of fun. Glad I joined and I really don’t care much about the options...I’m having fun, learning and the base plus bonus is very good. Would I have liked to get in earlier and potentially got more options? Sure I guess, but there are so many small startups it’s hard to know which will be successful. I joined at a point where I felt the success of my company was a pretty safe bet, so I feel like I’m in a good place even coming on board “late”
