This is normal in the US for roads in mountains (going uphill) and it generally works great.
159 karma · joined October 8, 2012
Interesting decision. Sure the dump is publicly available, but this is much more accessible.
But still super interesting
Square! In October 2012, we acquired the design firm 80/20 and have had New York based colleagues for some time now. Our logical next step was to bootstrap a NYC Engineering presence to tap in the growing community here. We just started building the Engineering team in July.
As a company, we have four main focuses.
Go international. We're adapting what made us successful in the US abroad. This is harder than typical international plays since it requires translating our four major benefits to small merchants: 1. Shipping readers, 2. Card payments (physical world is much more complex than online), 3. Sending money quickly to our merchants, a.k.a. settlement: very localized and next-day is hard on a number of fronts), 4. Assessing risk of merchants as they sign up, aka underwriting: again, very localized most countries do have FICO scores, SSN, D&B numbers and such.
Move up market. One of the biggest success of Square is to have enabled merchants who were "non-consumers" to start accepting credit cards. In classic disruptor fashion, we have essentially alonged the long tail. We haven't been eating someone else's lunch, we've created a whole new category! Now it's time to move up to bigger merchants.
The other side of the counter. With Wallet, Square Market (http://squareup.com/market) and Square Cash (http://squareup.com/cash), we're going on the other side of the counter and interacting directly with consumers. We think that we can provide the best experience for consumer-to-merchant and consumer-to-consumer commerce. We're at the infancy, but extremely well positioned to succeed.
Data as product. We're leveraging our data. We know a lot about our merchants: daily sales, seasonality, growth of their business, correlation with other events (e.g. Mapping Square Payments During the Super Bowl). Lots of innovative products are in the making which will highlight the breadth of what we do.
In NYC, we're starting with a focus on infrastructure, distributed systems, and money moving systems. We're a small team, located in SoHo, and defining the culture of engineering for Square on the East Coast.
If you're interested; I'd love to chat. Shoot me an e-mail with your resume! wkm@squareup.com
An alternative model: say you're offered $100/yr with 10k options a year with a nominal value of $5 and a strike price of $1. Superficially the offer is worth $140/yr. The startup's valuation is still important, because you can ask yourself questions about how likely they are to double it. It's much easier to project if the company can double to 10x it's value than what their exit is going to be.
Say that startup is worth $1mm. If they can double it to $2mm you're going to be netting $100 + 10k(10-1) = $190k. But can they double it? Up to your impression of their business. That's a much simpler question than wondering about their exit many years down the line. (their competitors generally are the strongest signals)
Observations:
this is computed with options per year; most startups would put this as giving you 40k options over four years * the options companies give you generally have expirations and very poor liquidity so using their face value is generous. [1] * but on the other hand, options can potentially increase in value, so it's not wholly unreasonable to equate them to their face value * this approach cuts out nearly all early stage startups which give below-market salaries and weak equity grants. Getting 50bp of a $10mm startup over four years is $12.5k/yr face value. If market salary is $100 and they're offering $75 you're netting around $87.5. That's a pretty stiff cut. * dilution isn't relevant (assuming you have options on reasonable stock) * if the startup is doing well (say, after a year doubles their valuation) it's difficult to negotiate another grant because you're now paid quite a bit better. Conversely, if the startup is doing poorly time to ask for more. * you may be okay with the pay cut because of externalities (more interesting work, good for the resume, better commute, etc.)
(ps. I normalized all salaries to $100k because it's easy to do percentages off of. Adjust by industry and specialization.)
[1]: That said, if you have reasonable timing you can use this computation to negotiate comp when changing companies so you're not completely handcuffed. (basically converting your equity from one company to another)