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Comment by pascalxus | Hacker News Reader

I'm a senior software engineer with over 12 years of experience.

6 out 7 start ups I worked for never had a liquidation event that resulted in any monetary gain.

The one that did ( i was employee #97 and worked there for almost 6 years) and they finally had a 2ndary offer which allowed me to sell 15% of my shares, for about 7K, but because it's short term gains, about 4K is what I got after taxes.

The rest of the shares were completely worthless because they couldn't be sold. I am not disappointed. I never assumed the options would ever be worth anything - I choose my employment based on Salary and work life balance. Options are just a nice bonus, if they do happen.

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Your argument is not making sense to me as someone who had offers from startups. I was asked to take roughly 40% pay cut now and expect 10X increase in valuation for equity over 4 years which would put me ahead by 2X to 3X in terms of total compensation over that time frame. I didn't took the offer taking to account risk of failure (~80%). If I treated options as "nice bonus" it would never make sense to take any startup offer over jobs at established companies.

That's why people say look at them like lottery tickets. There's many factors that go into whether or not they are worth anything - dilution and whether or not the startup is successful. The successful startup part needs good management, good demand for product, competitive against competitors.

> I was asked to take roughly 40% pay cut now and expect 10X increase

Of course you were. They are selling you on the dream, the best case scenario, etc. The hard part is that no-one is intentionally or literally defrauding, but it is up to every person what terms they agree to.

>If I treated options as "nice bonus" it would never make sense to take any startup offer over jobs at established companies.

It doesn't, from a financial perspective.

That's assuming you have job offers at established companies. If a start up is all you can get, then there's no tradeoff.

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