american158931

What's your opinion on how an employee should deal with a founder who clearly believes more in the A16Z stance on stock options more than the Adam's? Apart from obvious knee-jerk reactions like "stop working there."

Obviously it's in the founder's financial best interest (at least on the very surface level) for employees to not have the option to leave the company with shares at all. It is just lost money, from their perspective, and probably annoying to have an employee leave (creating a headache in your life) and take a bunch of equity with them. (And it severely limits an employees negotiating power over time, which can be of benefit to the founder...)

What are some strategies an employee can use to make the point that Adam's perspective is a much more employee-friendly one and, thus, better for the company?

Looking for some perspective.

Feels like an insane amount of dilution for early employees.

I guess what I'm getting at is something like this:

If you're given 1% of the company in the form of stock options as an employee, how can one get a grip on what that's worth should a company IPO? Like, if I came in as a high-level hire at Square. Early in the game. Jack gave me 1% of the company in the form of employee stock options. Now I'm vested. What would that mean to me now, after an IPO? How does one even begin to pick that apart if shares can be created or destroyed whenever?

Maybe I'm asking stupid questions. I'm just trying to understand since in my I'm constantly hearing numbers thrown around and, as a non-finance person, it can be hard to know what's really going on. (Which makes it easy to feel like I'm being taken advantage of.)

I'm seeing reports that Khosla led a Series A round of $10 million at $0.22/share (http://www.cnbc.com/2015/11/09/square-ipo-will-net-big-win-f...). At a $40M valuation.

$40M/$0.22 = ~182 million shares at that point? So they've almost doubled the number of shares they started with if they're IPOing at 300 million shares. Does that sound like a reasonable bit of math?

Can someone help me understand...

Let's say an employee was granted 10,000 stock options at $1/share. They're all vested.

Does this mean that each share will be worth $9? So if exercised and cashed out, the employee would essentially earn $80,000 (before taxes)?

Trying to understand how the economics of all of this works.

Also, does this mean there are 300,000,000 shares? (How many shares do start-ups usually start with before funding rounds and what not? Seems like Square must've started with 100,000,000 or something.)

So many questions.