How is Argo AI' equity work?

Apr 6, 2021 13 Comments

Hi folks from Argo AI, can anyone help explain how you guys' equity work? The total value looks far more than other competitors. But it seems not normal RSU like other companies.

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TOP 13 Comments
  • Argo AI
    TimCosmic

    Go to company page Argo AI

    TimCosmic
    The majority of employees at Argo have no idea how it works. The only one who has a clue is our VP of finance.
    Apr 6, 2021 0
  • Argo AI
    kGEH23

    Go to company page Argo AI

    kGEH23
    Here’s what I’ve gathered:
    - the number the recruiter gives you is based on a 20B valuation. This does not take into account any dilution that may happen as we raise money, and we could be worth more or less than that when we have a liquidity event. You can almost be guaranteed that there will be at least some dilution in order for Argo to raise money (I would guess anywhere from 5-20%? Just a guess). Just for another reference, the VW deal valued Argo around 7B, this was announced summer 2019 and the deal closed summer 2020
    - as long as you don’t sell within 1 year of your grant (which you probably won’t be able to anyways) then any money you get is treated as long term capital gains. This is a very nice thing compared to other companies and start ups equity, but is also the reason why it’s so damn complicated and seems like no one knows how our equity works
    - your profit interests (equity) will have a threshold value. This may seem like a “strike price” but here’s what it really is. If the value of Argo (per share) is less than that threshold value, then your equity is worth $0, if/once Argo is valued more than your threshold value then your profit interest will convert to a unit share and be worth $ (proportional to overall company value).

    Hope this helps! But by all means ask to speak to someone other than the recruiter for more info. I think a lot of Argo employees don’t actually know how their equity works
    Apr 6, 2021 2
    • Good info here. Thanks. Do you know if the threshold value is tied to the 20 B valuation? Who would be a good person to ask given recruiters don't seem to have a good grasp on AIUs and how they work? I would imagine it is very hard to get time with the VP of finance, perhaps finance staff?
      Apr 7, 2021
    • Argo AI
      kGEH23

      Go to company page Argo AI

      kGEH23
      No clue on what determines the threshold value, but lower is better.
      And yea I guess anyone from finance or even legal might be good to talk to (if you can)
      Apr 7, 2021
  • Argo AI
    argoao

    Go to company page Argo AI

    argoao
    Do you have an offer? What role?

    Normally recruiters explain these things fairly well
    Apr 6, 2021 1
  • Argo AI
    drapes

    Go to company page Argo AI

    drapes
    I don’t know, I hear they are telling new recruits we will be worth 20b one day so your equity is worth millions.
    Apr 6, 2021 0
  • Google
    tgnduurbk

    Go to company page Google

    tgnduurbk
    Hi, any insight on “current” valuation? 20B seems to be a projected future valuation, and equity grant computed with that valuation seems optimistic.
    Also, does Argo do refreshers?
    Apr 28, 2021 1
    • Argo AI
      TimCosmic

      Go to company page Argo AI

      TimCosmic
      Current valuation is likely higher than last valuation but not clear if it’s near 20B yet. Won’t know until there is another 408A. Argo does refreshers, but general consensus is they are weak
      Apr 28, 2021