Always remember that the place you work at has no (and owes no) loyalty to you. Calculate accordingly.
They’ve delayed the compensation by 5 months because “I joined late.” They didn’t tell me about this until I asked about 10 months in.
Hell I joined this company earlier out of college than most students. 2 weeks of vacation post-college when most students were taking 2-3 months. And now they turn around and tell me my compensation is going to be 30% less than what was promised my first year?
Now, 17 months later around the review cycle they are saying that our org has less money or whatever, and compensation will be lower this cycle. I’m expecting maybe a fourth of what I was promised.
How do they keep finding engineers?
[1] Well, except Intel. You don't hear about them much online, but around here the local office (not sure about others) bait-and-switches employee openings for contractor openings. They don't even pay that well, and no extra compensation either.
But they could be a stifling place to work. Intel is effectively a monopoly, with a clear development roadmap and a clear Process-Architecture-Optimization model with deliverables every 12-18 months. Pretty much everything about the company is setup to prevent anyone from rocking the boat. So their software activities are all about making sure the Intel architecture stays on top, their hardware activities are all about making sure that a new architecture comes out every 4 years and the die shrink happens on schedule, and they're basically averse to anything that might add variability or risk into their market position.
Certain people do really well in that environment, but for a lot of folks in software (itself a creative profession), that kind of work environment is basically hell.
I wonder if having Amazon on your resume is a bad signal now. Risk of the candidate being a participant in a toxic environment. Also a signal that the candidate was at Amazon because they couldn't get into other FAANGs (is it common for people to select Amazon over others when holding multiple offers?)
The contrast of their own attitude and actions in the face of being in a bad situation ends of very much working to their advantage. I enthusiastically recommend many of them as a "hire." On the flip side, every so often I churn up one of the perpetrators of toxicity, and I make sure what they tell me about themselves gets meticulously captured and reported to the decision makers.
So just having worked at Amazon doesn't automatically disqualify you in my book.
Also Amazon is easier to get hired at than other big tech companies, so I guess it is some strategic decision to hire/fire easily rather than have a stricter hiring process that would also introduced a lot of false negatives (like FLAG do).
https://abc.xyz/investor/static/pdf/2017_Q1_Earnings_Transcr... (first paragraph, page 3)
Those 2,5 years are now worth 1,7m$, which after tax is about half. I do wish I had stayed the 4 years, instead of valuing them at 0.
That said, I still agree with OP - it's good advice not to put too much stock in stock (unless it's liquid).
You don’t get to play as many hands in your career as you do in a session of poker, so if you’re optimizing for income, generally speaking you should go for a job that gives you the highest guaranteed income rather than work for startups with, say, 1% odds of netting you significantly more than you would get at FAANG, for example.
Late stage growth companies that offer RSUs can be sold on secondary markets, so even though it’s not as easy to sell it is probably not worth 0 unless something is very wrong, which again is something you should assess before accepting any offer.
- RSU's that I can only dump on a secondary market are worth a fraction of their face value. - Grants in a company that'll never have a liquidity event are worth a fraction of their face value. - Options in a public company are definitely worthwhile, but I shouldn't be negotiating their face value one-to-one with cash.
It's possible you've had a great outcome liquidating some equity from a private company, in which case I'm super stoked for you and that's a great outcome - but it's not the norm.
My point is that if you join a startup thinking your equity is and will forever be worthless, then why do you care if you get 10 or 10000 shares? To not care is bad advice for anyone joining a company that has a path toward IPO or acquisition. And if you don’t think a startup has any path then why are you joining a company that is offering you equity comp in the first place?
On one hand, the basic intent behind this advice very true. Liquidity is worth something; the reason people are willing to forego 3% returns on T-bills, 7% returns in the stock market, 9% returns on rental income, or 1000+% returns on startups is because they either need the money now or there's a non-negligible chance of the money not actually being there later when you need it. (Note also that those asset classes - and their returns - are in inverse order by liquidity.) Anyone who tells you that your stock-options are surely going to triple when the company IPOs or that this ICO is going to make you a millionaire or that owning real estate is a guaranteed way to build wealth is selling you bullshit. And it's very useful to be able to see through that bullshit and appropriately discount it.
But OTOH, people who say that you should value illiquid assets at zero are also spouting bullshit. That's clearly wrong: there are people who get rich off of stock options, or RSUs, or real estate, or cryptocurrency. And you're also strictly better off at a company that gives you $100K + 500 RSUs than one that gives you $100K. I know folks who didn't bother to negotiate for RSUs when they joined Google because they either didn't know what it was or valued it at zero; those folks now have a net worth several times smaller than the folks who negotiated for more stock. This is a poor-person mistake: believing that only those things that you can ascribe a cash value to right now have value.
Like most things, it's worth breaking out of excluded-middle fallacies and understanding that your optimal strategy lies in making a best-effort estimate of some very fuzzy and uncertain quantities. You'll be wrong, but you'll do better than either those who value those quantities at zero or those who believe the estimates of the folks who sell these assets.
For example let’s say you can take $240k TC at a big tech company where your comp is fully liquid, but instead have the option to take $170k base+bonus at a startup worth $400mm with RSUs valued at $50k/year. It’s easy to say that those RSUs are worthless and just go with FANG, but there’s nothing wrong with taking a calculated risk for slightly lower short term liquid comp in exchange for equity in a company you believe has a strong chance at 10xing. The net result is that you are choosing slightly lower pay in exchange for access to a high-risk high-reward investment
[1] https://twitter.com/ed_solomon/status/1139031900931198976
Is there a clause for when an upstream team decides to stonewall the work you've involved with?
What happens when your boss transfers and the new person you report to doesn't have any history to go on?
This stuff happens all the time, although mostly at the business level. Zeroing it out is a great way to make sure you aren't in financial position where you're taking a risk on things you don't 100% control.