"Price, as determined by a third party, is going to be BS. There is a reason we use markets for price determination. They’re not perfect but markets are the most efficient mechanism we have."
Yeah, but it's relatively even-handed BS if you're being given the option to sell, not being forced. If you're getting the same deal the investors and/or founders are getting, then you're not being cheated.
As for "the early employees might sell earlier", well... said early employees have a lot of info about what's going on. The risk is what it is. If you can "only sell your shares at IPO when there has been more than 1000x return since seed stage" the modal outcome ends up being "you can never sell your shares". This allows the employee to trade the lottery ticket in the future for some decent money now, and that's broadly sensible. But even more than that, it allows employees to diversify by having a bit of both. I've had cases where I'd appreciate that.
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"Price, as determined by a third party, is going to be BS. There is a reason we use markets for price determination. They’re not perfect but markets are the most efficient mechanism we have."
Yeah, but it's relatively even-handed BS if you're being given the option to sell, not being forced. If you're getting the same deal the investors and/or founders are getting, then you're not being cheated.
As for "the early employees might sell earlier", well... said early employees have a lot of info about what's going on. The risk is what it is. If you can "only sell your shares at IPO when there has been more than 1000x return since seed stage" the modal outcome ends up being "you can never sell your shares". This allows the employee to trade the lottery ticket in the future for some decent money now, and that's broadly sensible. But even more than that, it allows employees to diversify by having a bit of both. I've had cases where I'd appreciate that.
You're never getting the same deal as investors or founders. Ever.