Brocade stock backdating
Since VCs can and do diversify risk away, there’s no reason to believe that an individual employee who “invests” in startup options by working at a startup is getting a deal because of the risk involved.And by the way, when you look at historical returns, VC funds don’t appear to outperform other investment classes even though they get to buy a kind of startup equity that has less downside risk than the options you get as a normal employee.Download our report to learn about the biggest challenges and how savvy IT executives are overcoming them.Is Dev Ops helping organizations reduce costs and time-to-market for software releases? Find out in this Information Week and Interop ITX infographic on the state of Dev Ops in 2017.These days, enterprises have to track new metrics such as engagement, revenue per user, and the overall customer journey, which involve blending a complex web of data streams into a comprehensive marketing and sales funnel.In today's technology-driven world, "innovation" has become a basic expectation.
How are organizations striking the balance between new initiatives and cost control?So how come startups can’t or won’t take on more investment and pay their employees in cash?Let’s start by looking at some cynical reasons, followed by some less cynical reasons.One possible answer, perhaps the simplest possible answer, is that options aren’t worth what startups claim they’re worth and startups prefer options because their lack of value is less obvious than it would be with cash.
A simplistic argument that this might be the case is, if you look at the amount investors pay for a fraction of an early-stage or mid-stage startup and look at the extra cash the company would have been able to raise if they gave their employee option pool to investors, it usually isn’t enough to pay employees competitive compensation packages.If these startups are making a true claim about the value of their options, there should be a trade here that makes all parties better off.