Do not support investor-focused comp models like backweighted vesting (Amazon) or outright fraud like a start-up giving you a stock offer with no percentage or no 409A.
Employees deserve high-quality equity on par with investors. The OP’s suggestion is a major step back in one of the greediest economies in history. Complete non-starter. Don’t let this guy live in your thoughts rent-free.
There is no reason that labor and time couldn't build equity, it's just that our current system favors those who use capital to build wealth over those who need to sell their time and labor to build wealth.
A common reason I hear for the fact that investors get more equity is because of the "risk" they take on, as if losing some money is the only risk on the table should a business go under. What is ignored, or outright dismissed, is the risk borne by those who invest their time and labor in a business for little to no equity.
When a business goes under, the employees have just lost their abilities to feed themselves, keep a roof over their heads, see doctors, buy medicine and provide for their families.
Workers sacrifice time that they can never get back working for one business when they could have spent that time working at another. While money invested can be earned back, employees can never earn their time back. Sometimes, those workers are paid below market rate while they help make a business successful, but don't see much or any equity as a result.
It seems to me that there is more risk on the shoulders of employees than those of investors, and they should be compensated accordingly.
Even before these last few years of craziness, what I will never be able to get out of my mind is the story of Frank McCourt. I'm a lifelong Los Angeles Dodgers fan. He bought the team from Fox in 2004 and proceeded to treat a storied franchise in the nation's second largest city like it was his personal credit card. He didn't even use his own money to make the purchase. It was entirely with loans. He then proceeded to spend 8 years gradually bankrupting the organization until the league kicked him out and forced him to sell.
What was his loss? Nothing. The team sold for 8 times what he originally paid, not because of anything he had done, but just because television contracts for the entire league had become so much more lucrative over that time. The man put up $0 of his own money and made $2 billion by being one of the worst team owners of all time and making the organization he owned literally bankrupt.
I will never again in my life accept these econ theory gibberish about all the "risk" faced by business owners. If you own a salon or a restaurant or something, fine, I accept you might actually be out on the street. But if you're the right class of person that the banking system has accepted into the club, you can get infinite loans to buy whatever you want with no collateral, drive a business into the ground while spending the bulk of your time with hookers and blow, and make out with billions anyway.
Yes, but that's always the risk of working at any company (and it's a risk the investor may also have if the company goes under). You can typically just get a new job and get these things back.
I think an even more compelling argument here is the one of opportunity cost when working for a startup vs big FAANG company.
Early startup tech employees not only invest their time but also lose out on real money they would have earned at another (bigger) company.
I like this justification above all the others; it seems both fair and easy to reason about. If I quit a $200k/yr job to work at a startup for $100k/yr in cash comp, then my time investment, or risk, is $100k/yr, and my stock compensation should reflect that financial value based on today’s valuation of the stock.
"Financial risk" is a proper subset of "calculable risk" which is a proper subset of "risk".
I do believe that premium is probably a bit higher than it should be because it used to be EVEN HARDER to get that capital so people are pointing out the slightly outdated examples of cost in order to gain negotiating leverage.
In the end our time and money have no intrinsic value, but try asking a friend to help you move and then try asking your friend to loan you money to hire movers and see which they are more likely to do.
But the employee's time is a replenishable resource (1 second per second).
The Total risk is not losing your job. It's losing your job + struggling strongly to find another one (considering loss income while searching, stress, ...). Or workplace injury / death.
An investor, while facing low to none risk of workplace injury / death, can permanently lose the investment and won't recover it ever (hopefully the investor hedges it with other investments)
If you’re a VC harping on comp, spend your energy calling out frauds. Now that would be an actual public service.
Also, does anyone know of a good primer on equity founders/early employees/later employees should expect/require so they don't get totally taken advantage of? It turns out experience is an expensive teacher.
https://www.holloway.com/g/equity-compensation
It's complicated and there's a lot of gotchas I wish I had known. You can read up but if you are considering any of these I would find someone who has navigated the space (and has likely been burned).
This is from ~7 years ago, but my backweighted Amazon RSUs were balanced by a signing bonus, and another signing bonus a year later. Roughly, my total comp would be similar each year if AMZN stayed the same price, so it felt fair.
Overall, I considered the Amazon approach fair. But then I never considered the sign on bonus nor RDIs as part of my everyday salary, for me it was rather a bonus to be put away to be used when absolutely necessary. Allowed me to boot strap since Oct. 2019. Unsuccessfully so but that has hardly anything to do with Amazon.
Given that the year 1 cash could be used to buy stock if I really wanted, it didn't seem an unreasonable approach to comp to me.
Fuck Amazon. I'll never work for them.
I wonder if it has to do with cases where their "salary ceiling" would otherwise make the offer wildly uncompetitive for experienced people.
If the Board and/or the VCs ever get uncomfortable with the % of the company that is owned by ICs, they will just print more shares of stock.
And don't get me started on preferred shares. Has any IC ever gotten those?
Imagine I give you $1M for 10% of your business. You now own 90% of a business that has $1M in assets. You easily sell the whole business for $900k (giving away $100k to the buyer, basically), give me back my 10% * $900k = $90k, and keep the remaining $810k for yourself.
Preferred shares are a mechanism for preventing you from immediately liquidating my capital. An investment of time can't be liquidated as easily, so preferred shares are generally only for those making liquid investments.
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It seems there are probably other mechanisms for dealing with this problem, but this explanation makes _some_ sense.
This is horrible at pre-IPO unicorns like Stripe. One year vesting could cost normal employees millions if the company blows up.
Sure, the stock might not move much, or it can go down. A temporary dip means good performers are more likely to get larger refreshers to get tc up to market rate. And if pay is your driving motivation you can switch to a new job.
Of all things in the equity world this certainly doesn't seem especially evil, but what I can't stand is the half-hearted framings of this as good for employees. If you're deciding you want to keep more equity for yourselves, fucking say so.
And I would never want my employees to value their stock based on our 409a price, we (like all startups) do all we can to keep that number as low as possible!
Job market for IC is most of the time quite easy if you are technical, developers are usually spending 2 years at a company. I don't see C-level people switching companies on a whim and work one company for many years (not everyone is Elon Musk).
Once you have C-level on your CV good luck finding job again on lower level or the same level but different company. My boss is in it for life with current company, I can put my notice tomorrow and I walk away like I never worked there.
Why? As an employee I'm taking on nearly 0 risk. Maybe if they are paying me poorly I can see the argument where I'm "investing" more time/work into the company that I am being paid for and that difference should be made up with equity but otherwise this seems divorced from reality.
It's an investment by the employee. Coinbase is being cheap and it will come back to bite them. Odds are they don't care for the lifetime of the company since they're so tied to bitcoin's success.
I'm not sure how you are pricing things. FAANG stock comp is guaranteed money; You can sell it as soon as it vest for exactly the amount you signed for. Startup equity, not so much (there's no guarantee that a liquidity event will ever happen for starter).
Unless you are working in a lower tier market where stock comp isn't the norm.
You can argue that employees are fungible, but so is investor money, and frankly I'd rather take random money than random programmers.
When you are simple employee it is still better to get your paycheck and invest on your own in other companies. As a IC level employee mostly you can invest your paycheck freely. C-level guy before buying some stocks/investing probably has to go via lawyers/legal so he also is has lot less options for diversification of his investments.
You are also making such statement looking at successful companies, there are loads of companies and C-level people who were invested for life in it and company went under.
If you are IC you should get market rate salary, don't settle for less, invest it in other places. I don't accept equity as a compensation, I want market rate salary and the rest I will handle myself.
Let investors keep their risk, I don't want any of that, because you know not every company is successful.
On a more general note though, golden handcuffs can benefit the employee just because they are a guarantee. There's no possibility of future faking when it's up front and signed into a four year vesting schedule (e.g. "we'll give you a few percent next year but we need to get through this raise first").
If you only get the FMV from something like Carta, is that "enough"? I mean, it tells you nothing about the % at all. You can guess that the strike price will fit within a band (greater than 4, less than 35, likely around 17)
My, if only there were an economic philosophy based on that. Some kind of "social"-ism...
You'll just be getting less equity at a higher strike price every year, so it's just a sneaky way for these companies to give employees less. They can still say "we're giving you $100k in stock this year", but it's a lot less stock since you're not locked into a strike price.
If you want to leave after 1 year (post-cliff), you can leave under either scheme and get 1 year's worth of equity. This doesn't solve any "golden handcuff" problems, it just hurts employees.
Public companies issue an RSU grant at the beginning of employment and at no cost for the employee. Also if the share price goes below the grant date price, you’re likely recalibrated through rolling refreshers.
Let’s say you target RSU comp is $100k per year. Stock is $100 in year 1, $125 in year 2, $150 in year 3 and $200 in year 4. Ignoring inflation and taxes to make this easier to illustrate.
1) initial 4 year grant - $100k x 4 = $400k at $100/share is 4k shares. Assuming you keep all of your RSUs, you have $800k worth at year 4.
2) $100k of shares paid each year: year 1 - 1000 shares, year 2 - 800 shares, year 3 - 666.67 shares, year 4 - 500 shares. 4 year total comp in year 4 shares values is $593,334
So the employee receives $206.7k less under the new scheme versus the 4 year one. In reality, it’s even worse because we are talking high growth business here.
Layering in annual refreshers helps as well, but this is where things generally plateau a bit.
Don't do it.
It's catering to more risk-averse candidate pool.
You just can't estimate how compatible you and your employer will be 4 years in the future.
If FAANG had adopted this structure over the last 13 years, understand the number of rank and file engineers that became millionaires would have been reduced by an order of magnitude or more. This is just another way for VCs and finance in general to use their knowledge and positioning to skim all the upside on fast-growing companies.
It's one thing for a company to change their compensation policy and spin it in the best possible light—I don't like it, but it's just one company and I can at least hope the market teaches them a lesson. However for a VC like Fred Wilson to try to paint this as an unequivocal good is disgusting. Essentially this "golden handcuffs" argument is saying that rank and file employees who earn above market due to betting their labor long-term on a single company are a risk that should not be allowed.
The strike price of both grants is the same (say, $1/option)
Now the question is, what happens year 2?
If the company is a lot more valuable, two things will change: - strike price will be higher (say, $3/option) which makes the options slightly less attractive. But that's not the big deal - # of options will go down, because the more companies grow the more options are valuable and the less they give out to employees. So year 2 options will be 5K.
If this continues, over 4 years the end the employee will have something like 10K + 5K + 3K + 2K = 20K options vs 40K. Not only that, but the 20K options will have a much higher blended rate.
On the positive side, there will be no reason for the employee to stay if they don't want the new grant. But the reason they don't have to stay is that they were not comp'ed as much in the beginning.
So me reading between the lines, this will mean a lot less compensation for early employees of successful startups vs the traditional model.
There is a reason why the handcuffs are called golden. At the end of the day employees decide to stay because it's worth it for them.
Precisely this. Coinbase has made it and now they want to keep employees from resting and vesting. Stripe did this too. they're just being cheap.
One was willing to give a base-salary range but absolutely refused to provide any comp information beyond that. Signing bonus? Equity? "We are still working out those numbers for remote employees, we'll negotiate when we give you an offer"
The other - everyone at the same level at the same location gets the same comp and the same equity, here it is.
Guess which one I'm willing to pursue. These days the whole process of doing a tech interview is grueling, between the 'leet' coding practice, the take-home assignments, the 4-8 separate interviews. If they think I'm putting myself through all that without some guarantee of a considerable pay raise, they're crazy.
I don't think "wait til we get you the offer" is going to work much longer for a lot of companies. Not unless they go back to the old-fashioned "tell us about yourself" interviews, which would be quite a relief but I don't see happening anytime soon.
First you have confused uncertainty with a bad scenario. For all you know the offer from the first company would end up much higher than from the second but you won't know.
Second, and this is probably a bigger deal - lack of exact range often indicates flexibility in seniority, skillset and scope. So in your case, your only good scenario is if you match exactly the picture of an employee company 2 has in mind for the role/comp. If you are just a little under, you won't make the cut. If you are any over, they will underpay you.
Comoany 2 gave themselves more flexibility with hiring and paying you. Eg if you aren't quite on the level they thought, they could level you down as a say in, which you would appreciate. Similarly if you are beyond what they expected they may offer you more than you'd think, and more than company 2.
Mainly, you have cut yourself off from valuable information and potentially leverageable competing offers because you couldn't hang with a bit of uncertainty.
The flexibility should be reflected in the job title or level; salary bands are vital to ensure that people at the same level are being compensated equitably and know what they're interviewing for up front. It's totally fine to tell candidates they're going to aim for a L4 position with the possibility of L5 (or higher) depending on interviews.
Maybe I'm a cynic, or I've read too many books with a powerful cabal that lies while telling the truth.
But one interpretation of these words is that you are going to be a test subject in that 'work it out' activity.
Why should a remote employee in Atlanta make more than an onsite one?
[1] https://blog.coinbase.com/how-coinbase-is-rethinking-its-app...
Negotiations are normal part of the process, if they try to eliminate it, they will simply not receive applications from the top candidates.
Blaming it all on "women and minorities would end up underpaid" is a brilliant excuse.
They want equitable policies, and they want to take candidates' leverage, but ultimately they hate to lose someone they've decided they want.
The fact that different socioeconomic groups approach negotiation differently has been shown to be a strong contributor to pervasive, long-standing differences in pay. This is a good step to start to address that inequity.
Normally I'd agree with you and merge the threads or similar—but I'm not sure I'd call this post blog spam. It's true that it doesn't go deep, but he's raising a general question that isn't quite the same thing as the OP.
For those wondering, they’re doing:
-increasing comp targets to be at or above industry 75th percentile across the company
-no negotiation for comp (standardized starting offer by location/role)
-yearly stock grants with no 1 year cliff upon hire
Does industry include programmers at Comcast, Liberty Mutual Insurance, Staples, Smalltown Bank, Wipro, and everyone else who employs programmers in any capacity?
Or does it mean Amazon, Facebook, Netflix, and Google?
If you're beating three out of those four, your comp is excellent. If you're beating 3 out of 4 all companies who hire programmers, you're hopelessly uncompetitive with the "actual" top tech market.
They say it protects against downside, but odds are if the company isn't doing well they'll cut the dollar value of annual bonuses as well.
They are paying people less because they want to keep them in the "golden handcuffs" for longer. The way it's painted by this particular VC is particularly gross.
Also executives usually keep the upside potential. So as an engineer if because of your work the company skyrockets and becomes 8x more valuable over the year you share 0% of that upside, while executives cash in. On the downside, as an engineer you can just leave because the market is very fluid, truth is you don't need job security from your employer if you are a good software engineer. If/when that changes probably compensation will go down enough so that this mega-grants are not going to be a problem anymore. They are just counting pennies.
If all they do is give you 1/4 of the equity they were going to give you previously, then yes it drastically reduces employee upside to the benefit of others (execs, investors).
But they probably can't do that because it would be harder for them to attract talent against a 4 year vest company. Instead they'll probably have to bump up that initial grant so that when employees do the math there is still the big upside if the company improves.
I remember how much trouble the yearly bonuses caused when I worked at Google. In the fall, some people would become much less active and turn from top performers into dead wood while they hung around, waiting for the yearly bonus payout in Jan.
> It sucks that people might want to leave a company but won't because of how well they pay, so we decided to stop paying so well! Problem solved!
It'd be one thing if the comp was adjusted somehow to make up for the loss of extra upside. (Some companies switching to 1-year grants seem to be saying they're going down this route). But just cutting the grant length is literally just a comp decrease. (Which, of course, makes it easier to leave).
I think this is really trying to optimize to keep only the high performers without having to have a traditional stack ranking system.
Interestingly, I recall the Google article about the highest performing teams not being made up of the highest performing individuals, but the best communicators. No one seems to be trying to hire to create the best teams, but still just the highest performing individuals. Perhaps there is a Moneyball in tech work.
Not saying this may not be like, true in the ontological sense... but as an experiment it's shitty because they measure performance by how good you are at communicating what you did and what impact it had.
> Because our standard offers are world-class, we are officially eliminating negotiations on salary and equity from our recruiting process.
> We are OK if we lose some candidates due to this decision — the best candidates for Coinbase are those who are looking for a highly competitive package and are ready to let their contributions speak for themselves.
I'm sorry but that's a self-contradiction (even oxymoron). "highly competitive package" these days is after negotiation, period. If you're 100% firm on the offer when asked, then people seeking "highly competitive package" (after balancing all other factors of course) can and will simply walk.
As for the "let their contributions speak for themselves": For (especially early stage) startups, any promise to raise the compensation later *cannot be trusted*, period. It's not written on your offer (except for maybe "guaranteed/target bonus"), and the management could always come up with "budgets" --- basically handing out far less than what would make up for the initial compensation deficit, maybe except for a few people in the "inner circle". Having been both in and out of the "inner circle" myself, this difference can be significant over time. Also as the startup goes through funding rounds, company policy will change and the people who "promised" you will inevitably leave, etc. etc.
But on the other hand, it does seem off for so much of your compensation to be based on how well you perform in a five hour interview or how well negotiate it as opposed to your actual work.
I can see why companies don’t like this situation, because it’s very hard to reward performance with compensation when everyone is making far more than scale. Your best and worst performers all take home big checks. But to pitch this as an employee-friendly move is gaslighting at its worst.
(The reason for the 12% reduction may not be obvious. When converting an annuity, they look at actuaries to estimate when I will die. The lump sum payout converts the annuity payments from the retirement date to the date of my death into one payment, distributed over five years. If I work longer, the time between my retirement and my death decreases. Thus the longer I work without retiring, the lower the payout.)
My golden handcuffs were changed into a golden kick in the arse.
"Letting that market operate efficiently and not trying to game it makes a lot of sense to me."
This is not obvious to me. In many ways, the job market is not like other markets. Onboarding employees is a money-losing proposition. Turnover is disruptive. Recruiters cost money. Benefits operate on a calendar-year basis or have waiting periods.... I could go on, but there are all sorts of reasons for companies to pursue retention over an "efficient market."
I think it would be good for Fred or Coinbase comp team to provide the expected payoff calculations for various kinds of employees under this new scheme - the hard numbers and probabilities (even optimistic ones) would be what convince me.
https://a16z.com/2016/06/23/options-timing/
> Well, not exactly. There is a more fundamental issue at the > heart of this seemingly good solution: A 10-year exercise > window is really a direct wealth transfer from the employees > who choose to remain at the company and build future > shareholder value, to former employees who are no longer > contributing to building the business/ its ultimate value.
But not mentioned in either is that these long running exercise windows "hurt" _all_ shareholders, especially investors. Nice of both to make this about the little man/woman.
I only wish their worth and value to the company was met with the same scrutiny they seem to give employees.
No; in general "golden handcuffs" refer to any situation where future financial compensation counterbalances any desire to leave. You give one example, but there are lots of scenarios (it could as easily be pension qualification, or earn-out rights, or whatever).
Public companies gives you X dollars worth of shares at the current price of your start date over 4 years. Meaning if today the shares are worth $1 and they want to give you $100k of shares, then you get 100k shares over 4 years.
If after 2 years, the unvested shares (50k) 3x in value, ($150k) you have to stay to continue to earn the same number of shares, but are worth 3x what they originally were.
So he isn't misusing the definition, just using the broadest possible sense of the term.
The only part that's like golden handcuffs is the 1-year cliff that's standard, but 1 year ain't bad.
For me, my base salary is quite enormous, but with some work I could find something within 20%. (I am exceptionally lucky, its not skill)
However, what I can't replace is the stocks. Depending on performance its ~3-5 times my already vastly over inflated annual wage. So I'm stuck here at the boring FAANG company not achieving very much, because to walk away from a small fortune would be madness.
There is no real incentive to work harder, because the difference between working a normal 35hour work week, and the 75 hour week required for promotion is another 10% on base.
This seems to make long-term ccompensation even more volatile. Who says the company will grant me a similar options package all 4-years. Business needs change, and it might do any of a million other things.
Sure, the stock-price may go up, or may fall, but that is somewhat out of the day-to-day control of the company. Or it is much more out of the company's control than next year's personnel budget, where you just have to convince the CFO of what the right grant value will be.
I find another paragraph from that press release interesting:
>Traditionally people expect they need to negotiate for the best package after being hired in a new job. Those that do this well tend to be rewarded, and those that don’t lose out. These negotiations can disproportionately leave women and underrepresented minorities behind, and a disparity created early in someone’s career can follow them for decades. We want to do everything we can to ensure that’s not the experience at Coinbase. All employees in the same position, in the same location, receive the same salary and equity offer. No exceptions.
If this was mandated to be standard practice, instead of the insane approach some countries take with minority quotas and such, we'd be a lot further in terms of equality in the work place. Also salary negotiation favors aggressive and outgoing types, while there might be qualified candidates who get left behind just because of their personality.
This is a tough problem, but these non-negotiation policies aren't the solution. They make the inequity even worse since it becomes harder to negotiate (for title) than for incremental comp increases.
I suspect this policy and the 1-year grants makes it quite a bit harder for Coinbase to poach employees from FAANGs.
When someone you have a semi-adversarial relationship with removes your ability to negotiate, they aren't doing so in your favor.
If decisions are made by the higher-leveled ICs, then it seems like even more decisions will be made by white men under this culture.
Yes, this is how it should work! Their role will then involve a higher level of responsibility and expected output that they better be prepared for, and they'll be compensated more for that.
It makes much more sense than people getting higher/lower compensation for the same level of responsibility and expected output based on their competing offers at the time of signing, doesn't it?
This offers a more level playing field for employees to begin their time at the company without stringent rules around who can get promoted and when and other red tape. Seems like a great decision.
This creates some perverse incentives. I've worked at large companies where when compensation didn't fit an existing standardized value, they would literally create a "new position type" in the HR system for that hire that not coincidentally matched that hire's salary requirement. This caused a weird proliferation of titles that had little semantic relationship to the overall organization. At one company, they had 1,000 roles in the HR system for this reason, that at any sensible company could have been reduced to fewer than 100.
I feel like if you had a skill they REALLY wanted, they would create a new position for you to get around this rule.
How do they define location? In one city, there are neighborhoods where the median income is six figures while it's a fifth of that in another. Same can be said of two different locations in a state or county, or two different states.
If the vesting grants are an excuse to underpay me, then that is a bad thing.
An employer's perspective is different to mine, and some companies cannot compete by offering grants. This is probably what this article is really about.
Its just one part of a companies toolbox to increase retention.
If you would tell me that i get my current additional bonus as it is without splitting it up to 3 years, i would of course take it but i assume that internally they were able to form/create this type of program and the 3 years was an internal bargain chip.
Not in any way that's good for the company, though. That'd be a classic application of optimizing for the metric, not in what you really want optimized.
Usually if an employee is staying solely or mostly because of the handcuffs, they're not producing their best work, and aren't fully engaged or focused. Do you really want to keep an employee like that around? Wouldn't you rather they left, voluntarily?
On the flip side, as an employee, I like the idea of golden handcuffs. In a hypothetical situation where I didn't like where I worked, I could drop down to doing the minimal amount of work that wouldn't get me fired, and coast along while collecting the money. Sure, it's not a particularly fulfilling life, and probably wouldn't be sustainable for the long term, but maybe it's not that bad for a while.
I know plenty of people with handcuffs, including me, and this doesn't apply to any of them. I think that claim is common but is in fact not justified in the real world. Your top performers are basically top performers for personality reasons.
Sure, if your company spends 10+ years getting to liquidity, which became popular in the mid-201x because not a single one of them was even remotely financially sound and the markets weren't ready to bite that off yet, you had people staying years longer than they should have, but it is not nearly as big a problem as people claim and was, mostly, because the real value was being captured by early/founder insiders in late stage super-sized PE rounds instead of going public.
This is much worse for start up employees - as grants each year allow for even more dilution, management hand wringing, and changed expectations. Do founders stock get magically taken away when they suck at being a CEO? When deadlines are missed? Generally they just get moved to the board.
The commitment you receive from your employees is HUGE. They show up 40+ hours a week, and bet their entire family and time on your company. Stop acting like somehow paying them even 0.1% as well as your founder is somehow a "bad marriage".
If they're pulling down the team, fire them. If you're afraid they're making too much money and may quit / retire - why are you in capitalism at all? Ownership is supposed to provide benefits.
The brazen attitude towards those that actually build your ivory tower is incredible.
Reduced golden handcuffs can only hurt the rank and file labor market. No surprise a VC is enthusiastic about it.
In the new way, all that potential upside comp is eliminated, so employees will earn less and feel better about leaving.
Seems like first option is far better for employees. Please give me those golden handcuffs.
This was also the best way for normal employees to “strike it rich”, which isn’t a bad thing.
Another reason for doing this is that stock options don't work well when the stock price (and company valuation) is already high. You end up with a big tax bill betting on growth that often doesn't come for already-highly-valued companies.
You could spin this as being employee-friendly, but it's more about being pragmatic about the fact that the company probably won't be able to 10x its valuation like in the old days, and now views itself as "safer."
The problem with a 1 year grant is that it provides an unstable compensation target, for a public company most employees will prefer cash to shares that may be up or down 15% at year end.
This is part of the reason a cash-biased compensation package at a startup can be attractive. Effectively it places less coupling between your career path and financial success, which IMHO reduces unnecessary stress and gives you freedom to make the trade-off between these two at the time of _your convenience_, rather than some fixed number of months.
New grant (assuming with new price) every year is a joke. Potential for rapid wealth growth is the reason many work for a startup in first place.
Don't you just love it when you're treated as a commodity in a market?
> we ... expect them to earn their seat at Coinbase.
So, I'm working someplace, I'm always under threat of termination and have to prove, repeatedly, that my seat shouldn't be taken from under me.
Of course, the owners of coinbase don't have to earn their seats every year, or any year, right?
At this point I would make a derisive comment about Capitalism, but to be honest - the company's business is financial speculation with made-up currency, so I guess that's to be expected.
This seems like something more later stage, high growth companies are adopting. It’s simply much cheaper for the company to give out single year grants. Basically a challenge to the whole "rest and vest" culture.
