Risks of paper money?

Amazon
wryajbnxm

Go to company page Amazon

wryajbnxm
Sep 3, 2021 23 Comments

Paper RSUs (shares from private companies like Instacart, Stripe, DB, TikTok) are currently worth $0. Some companies may institute a buyback policy but the price offered is usually significantly lower than the price used in offer letters.

Given that for most startups, you get to keep vested RSUs even after you’ve left (up to a given period of time). Are there any big risks from accumulating so much paper money?

Multiple funding rounds could dilute RSU value and some companies just don’t want to go public (e.g Stripe).

Is it better to just go with offers from public companies that offer non-paper RSUs?

#tech #startup

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TOP 23 Comments
  • lol if anyone from instacart, stripe, and tiktok thinks their RSUs are worth $0, I'd be happy to buy them. @amazon, your entire premise is wrong
    Sep 3, 2021 7
    • Google
      bliinder

      Go to company page Google

      bliinder
      Congrats 🍾
      Sep 4, 2021
    • Stripe
      chunder

      Go to company page Stripe

      chunder
      And what happened to FB and SNAP stock since? If you had stock in FB’s IPO and held you’d be on your yacht right now

      The premise is silly. RSUs have a $0 book value, but that’s good because it means you don’t need to pay taxes to hold an illiquid investment. The intrinsic value is much more than $0. If you think there’s a chance the company won’t IPO then you can mark the value down to adjust for risk, but not to $0.
      Sep 4, 2021
  • Chime / Eng
    zxcvbnm$

    Go to company page Chime Eng

    zxcvbnm$
    Here is what I have seen from seniors of my uni, joined faang, stayed there for 4-5 years, bought a place by selling the vested stocks. now, once they are settled they started joining startups like Twitter, snap, etc 7-8 years ago and now some of them are at stripe, Instacart, databricks, etc. I guess it depends which point of life you are in right now.
    Sep 3, 2021 0
  • Apple
    iTunes

    Go to company page Apple

    iTunes
    In the end, it's up to your choice. No one can tell you the risk or value of paper money.
    Sep 3, 2021 5
    • Apple
      iTunes

      Go to company page Apple

      iTunes
      You can always do some stats from previous cases. But from employee's perspective it's just hit or miss. General statistics doesn't matter.
      Sep 3, 2021
    • Amazon
      wryajbnxm

      Go to company page Amazon

      wryajbnxm
      OP
      When has it been a miss? Most huge unicorns have IPOed at this point apart from a select few like Instacart, Databricks, Stripe, and TikTok
      Sep 3, 2021
  • Cant guarantee anything, its a gamble. And some companies offer options and we even need to purchase them if we leave, with no guarantee that they will go public one day.
    Sep 3, 2021 0
  • Microsoft / Sales
    ijku75

    Go to company page Microsoft Sales

    ijku75
    Just don’t count equity that you can’t exchange for real money as part of your TC. Then there isn’t any risk.
    Sep 3, 2021 0