HACKER Q&A
📣 throwaway_gp

Should I quit now or wait for an hypothetical acquisition?


American company, New York. The company is sinking. Founders want to sell. The company has mainly been funded by "SAFE" investments, with no ensuing VC round (series or seed). I think they raised around $2-3M total like that. The founders insist the value of the company is between $5 and $8M ; but after 2 - 3 months since they started the process they have had only one offer at a much lower price (i don't know which price).

They want me to stay to be able to sell the company, for which I won't want to work for anyway. I have a really nice opportunity elsewhere to which I already answered yes, verbally.

They offer me 2.5% common stock (options) and a raise to stay.

Are the 2.5% they are offering me really potentially worth $100k as they say ? I've seen a lot of stories where stocks don't pay out for many different reasons in the end. Won't the investors get their money first, which means it's very likely employees won't get anything (To me, the probability they manage to sell at the desired value is very low) ? Should I give them 6 months ?


  👤 gus_massa Accepted Answer ✓
For simplicity, let's assume the 2.5% of common stock is worth nothing (this may be a good approximation).

Are they paying you now in hard green real cash now? (Not a promise of cash, not IOU, ...)


👤 chrisbennet
I would not gamble on any "magic beans" (future earning from stock). If they have the cash, let them double your salary to stay. If they don't have the cash (and they probably don't), take the other position.

You were going to get screwed in the end even with a "successful" startup. While the founders will share the profits you realize that you weren't going to? Like you alluded to, the VC's an maybe founders will have preferences that mean you get nothing. There will some reason but the end you will end up working for less than you are worth in order to enrich others. As I like to think of it "I can't afford to subsidize your business any more."

You have to view this as business - a value for value relationship.


👤 simplecto
The only truly limited resource is time.

What if, in 6 months, nothing came of things and it simply shut down? How would you feel about that time spent in the existing, and probably increasingly stressful, situation versus the new thing (which seems like a sure-deal)?

I left a much more stable situation in which I had equity because my time and happiness was simply too valuable.

Think about your time...