I Just Got Paid For Work I Did 20 Years Ago.
Startups Should Work To Make Their Employees Wealthy Not Just Their Founders And Investors
Earlier this week a modest deposit appeared in my checking account, one I honestly never expected. You see, it was for work I’d performed from 2001–2003 at a startup called Linden Lab, the company behind virtual world Second Life. And when that company was acquired in late 2020 by another private party, my stock purchased in 2004 turned into cash. The transaction size was small compared to the IPO and SPAC headlines from the past few months, but I had the benefit of being an early, single digit employee, and hence a stock value of around .04/share if I’m recalling correctly. That low price was part of what enabled me to purchase my vested options when I left, a conundrum that exiting employees often face.
Thinking about this outcome, and jumping into a Linden Lab alumni Zoom over the weekend, swirled a bunch of feelings. So much has changed since those years trying to build an online community with a small group of people in Hayes Valley. I subsequently joined a larger startup that got really big and then cofounded a venture firm with a close friend/former colleague. I tried to outrun failure only to realize I need to embrace it. And I achieved ‘Silicon Valley Middle Class’ wealth status.
But the real takeaway was that if you want to work at tech startups and can find one you’re excited about that is both (i) A+ people and (ii) treats you fairly with regards to compensation, including equity, take the job. Don’t overthink it. This is also where I acknowledge we’re talking about being privileged enough to take a job with a startup in the first place, to have even a small amount of savings to risk on the equity and the structural issues which prevent many people from realizing these outcomes. Consider that an asterisk as you read forward and commit to creating opportunities for others, not just yourself.
While I’ve said before that one should approach these situations with eyes wide open [“Sorry Startup Employee #100, Your Equity Probably Won’t Make You Rich”] I also firmly believe ownership is the key to wealth. A career in technology is a very good path to financial stability and stock equity has been a meaningful contributor to that for me and many others. It’s always why, in my venture role, I get so excited when I see an outcome large enough to benefit an entire team, not just the executives and investors. It’s also why I support making early exercise available to your seed/A employees at the very least. And extending exercise windows for longer than 60 days to employees who leave on good terms. And why we work with the founders we back to make sure there’s enough equity set aside to make great hires.
FWIW, we also back up this belief with actions ourselves. Everyone on the Homebrew team receives carry in the fund. What that means is that in addition to salary and bonuses, when Satya and I get profits back from the fund, so do they. You can’t preach ownership mentality outside your firm and do something different internally.
Notes and More
The high of Georgia run-offs and the low of watching domestic terrorists murder a police officer at the Capital.
📦 Things I’m Enjoying
Here’s my annual recommendation for the easiest way to make hard-boiled/poached eggs. And I just started Watchmen on HBO — no spoilers please!
🏗 Highlighted Homebrew Portfolio Jobs
Tia is healthcare designed for women from the start, combining IRL clinics with URL telehealth. They’re a well-funded post-Series A startup that’s growing quickly to meet the needs of their clients. If you’d like to join the Tia team and build the future of care, they’re hiring.