Re:Do the math on your stock options
by pc86 on Thursday December 31, 2015 @10:53AM
(#10818064)
There is absolutely no reason not to disclose the number of outstanding shares. Failure to do so means the denominator in the equation can be anything. One or one billion. At that point you have to value the entire option nonsense at $0 total, or even negative given the tax implications. It takes all the truth out of the statement "our cash compensation is below market because of our generous option grants." If I can't figure out the monetary value of the options at the given strike price, I have no way of knowing if they're generous or not.
[ Parent
| on HN ]
Re:Do the math on your stock options
by mpdehaan2 on Thursday December 31, 2015 @11:12AM
(#10818178)
Reasons exist.... One reason is likely that they want to keep the valuation confidential outside of the company (people talk), because as a private company that information doesn't have to be public. It's not a great reason for the employees - but it's there, nonetheless.
It's tricky to share that with employees and not have it get out.
That being said, if it were all public, I think that would be fine, I'm not sure what results that would cause if every company did that, and it might be cool if every company were required to by law (hint, hint, congress!).
"Reasons exist"
And absolutely none of them are valid. If you're going to have this person work on the core of your company, there is absolutely no reason to not be up front with them.
Re:Do the math on your stock options
by mpdehaan2 on Thursday December 31, 2015 @08:23PM
(#10820714)
It's quite valid and exists as a reason, you just don't agree with it :)
No, it's not valid. The only reason it would be done is for deceitful reasons. Therefore, not valid.
Keeping it private here means private from external companies that should not have access to that data, not employees. This includes competitors, M&A targets, and investors who have not yet invested and should not have access to the books.
I do however strongly believe in tempering expectations, it's wrong to try to retain people by thinking they have more than they do.