

22-Year Veteran Of Startups Says Employees Are Getting Screwed By VCs And CEOs - denzil_correa
http://www.businessinsider.in/This-22-Year-Veteran-Of-Startups-Says-Employees-Are-Getting-Screwed-By-VCs-And-CEOs/articleshow/31565456.cms

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mindvirus
His last clause is interesting:

> Last, because two thirds of employees know squat about acquisition-based
> vesting acceleration triggers, they often sign offer letters that give them
> no protection against being demoted or fired before or after (but in
> connection with) an acquisition.

How would one negotiate something like that into their contract?

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hga
Decline the stock offering. Don't give them an incentive to get rid of you
during these transitions. Note that you can't judge the probability of the
latter, since no matter how good the will of the current players, a new
investor might turn out to be a devil (been there, done that, resigned _en
masse_ with 12 others, almost all, and of technical staff all but one new
hire; had to use the government just to get back pay).

It's all a risk/reward calculation, and with the closing of the IPO exit for
all but the most exceptional, stuck by lightening companies, it's pretty clear
the possibility of a big reward is _very_ low. But balance with your estimate
of the probability of a big success, and how well you can make such an
estimate.

I can see this presenting "you aren't a team player" problems, though.
Certainly signals you don't believe the company will be a big success.

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mindvirus
I don't understand what you're saying. Decline which stock offering? Don't
work for equity at all, you mean?

~~~
hga
Exactly, except it's "don't work for non-vested, they can take it away from
you" equity (which is not to be confused with equity where they have the right
of first refusal to buy it back if you separate). When they ask you to sign up
for deferred stock options, which requires paperwork you need to sign, don't.

Or if it's a sufficiently confused small startup, never return the paperwork
and let it slip through the cracks ... although when it comes time for the
investment/sales event, they've got to _know_ you have no options....

Hmmm, for excuses maybe mention some of the screw cases where people got
options vested---exercised them? I forget the details---but the stock then
tanked, and they had a big tax bill. I.e. throw FUD on the mechanism, the IRS,
etc., but not the company. Or say you're a proletarian ^_^?

