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Comment by mahyarm | Hacker News Reader

Well you do get secondaries, but it's usually only something like 10% of vested stock, while your still working there. The lack of a public market also makes it far more risky to hold the stock for long term capital gains tax rates. I agree the lack of IPOs make equity earnings less valuable to the typical employee.

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I wish more people knew this. Even if you beat the odds and the startup you work for goes places, you may only get 10%-15% of the proceeds now, and be hoping for the rest even further out in the future. Almost certainly better to just work for a public company from the start.

Are you saying you only get 10-15% of the proceeds of YOUR vested stock? So if I have 1% of a $100m company, my shares would only get me $100k, not $1m? Can you explain or link to a source of more information?

If you have 1%, most likely you are an early employee.

There's a formula: VCs and founders get reach, early employees get screwed and employees get their market salaries.

Petalpete - the comment above refers to pre-ipo sales of employee stock.

A bunch of private companies that hit billion dollar valuations let employees sell some of their shares. That person is claiming that those sales allow employees to sell 10-15% of their vested stock.

Of course, if they do that, they still keep the other 85-90%.

This is exactly what I meant, thanks for filling in the details.

You can opt to sell in the IPO/secondary, but otherwise you're generally free to trade when the trading window is open for current employees (typically) 180 days give or take post-IPO.

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