Understanding downsides of 1 year equity grants

Lyft
smashqatch

Go to company page Lyft

smashqatch
Oct 5, 2021 16 Comments

First off — I agree that 4 year equity grants are strictly better due to upside of the whole grant appreciating over time. However my time at Lyft with a 4 year grant hasn’t really gained much at all 🤣

Everyone loves Netflix who famously pays all cash — there’s very limited upside in this package. A pre-IPO company like Stripe may only give a one year grant, but there is potentially huge upside for all grants vested prior to IPO. At a publicly traded company like Lyft, 1 year grants are essentially like cash if you just sell on vest (which you probably should), so in my mind this is somewhat equivalent to an all cash offer like Netflix.

At I missing something here?

TC: 570k

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TOP 16 Comments
  • Facebook
    qwertyqwet

    Go to company page Facebook

    qwertyqwet
    What is the refresh at Lyft for e5 with the new vesting structure? Besides an initial grant we also get refresh every year that probably is very close to what Lyft pays without huge initial grant.
    Oct 5, 2021 10
    • Lyft
      smashqatch

      Go to company page Lyft

      smashqatch
      OP
      Fair points. I’m bullish on stripe’s future so not too concerned. 1 year grants are great for for the company but it’s not like the TC is low for me. Pros and cons 🤷‍♂️
      Oct 5, 2021
    • VMware
      vFear

      Go to company page VMware

      vFear
      As long as the company gives such grants which are above market I guess it’s okay and a fair deal. The moment those grants are equal to those offered by faang companies I believe the 4 year vesting schedule becomes more attractive.
      Oct 5, 2021
  • Amazon
    kissmyass

    Go to company page Amazon

    kissmyass
    There are pre-IPO companies that do 4 year grants.
    Oct 5, 2021 2
  • Lyft
    upxm26

    Go to company page Lyft

    upxm26
    All cash offer should not be evaluated similar to 4yr grant offers. Usually, ppl seek higher comp in case of all cash.

    Same goes with 1yr grant. Be it all cash, be it 1yr grant, you have limited upside (outliers exist)
    Oct 5, 2021 0
  • Amazon
    severallyL

    Go to company page Amazon

    severallyL
    They could reduce everybody's pay by just lowering bands whenever they feel like it, which is way easier than lowering people's salaries
    Oct 5, 2021 0