Re:How to avoid start-up success? Not offering equity!
by gyro_robo on Friday April 20, 2007 @06:11PM
(#15217)
> look at Warren Buffett's philosophy on employee and management stock options. In earlier days he attracted key management with a fair salary
Today's environment is much, much different. ALL key manangement will require equity.
That example is kind of like saying Apple attracted people with a 1 MHz 6502 system. Different time, different standards.
Re:How to avoid start-up success? Not offering equity!
by jonmc12 on Saturday April 21, 2007 @07:45AM
(#15446)
I'd agree, environment is different. Risk of being on a management team is different. As is the culture of compensation and employee marketplace.
What has not changed is that company ownership is about investment risk.
In your example, it sounds like a pretty weak deal. However, thats not to say that the lesson to learn is to attract employees through equity.
Owning equity is about risk. Employment is about security. If your really a savvy investor and think that equity in a given company is the best return on your investment, you should offer to put as much cash and man-hours into the company as you can for the greatest return. Then you are on par with the founders.
For interesting reading, look at Warren Buffett's philosophy on employee and management stock options. In earlier days he attracted key management with a fair salary, a good work environment, and an absolute lock out of equity.. he figured he was the only one taking the risk.