HACKER Q&A
📣 throwaway106720

Am I being fooled at a Dutch startup?


A couple years ago I started working for a Dutch startup. I was offered an equity package, but didn't think much of it at that time. After going through a couple of funding rounds, well, I started looking into it. The Dutch structure is called STAK and is basically a company-in-a-company without any voting rights. Currently it is about 6% of company stock divided among 10 employees. I'm still very well aware that it could be worth 0 EUR in the end. I also very well aware of tricks being played by investors and engineers being squeezed out of their faire share. Since money came, it all about scaling up and getting a good exit.

A month ago I (and the other engineers) were finally able to sign the original STAK equity contract. It was apparently an additonal contract. This might be negligence on my side, but I simply didn't know. The equity package and vesting scheme is briefly mentioned in my initial contract. In this new contract the vesting scheme changed and included a lot of additional company and personal goals to be achieved. So it is not only time-based now. (it was said this was for tax reasons). Due to this it makes it a lot harder to vest any additional stock (about half would probably impossible to vest).

I'm on good terms with the founders and I think it is possible to renogatiate this. But I don't know where to start. I read a lot about equity packages at American startups, but this probably doesn't apply for my situation. Can anyone offer me advice - What to do best? - How do I make sure what I vest, I really do vest and they don't change the rules again? - Is it worth anything (even after an exit). - The additional goals were set because of tax authority rules (is this a straight out lie)?


  👤 y7 Accepted Answer ✓
Wait, you were offered an equity package years ago but are only now receiving the certificates, and there is still a remaining vesting schedule? This sounds extremely fishy.

I think a fixed-time vesting over 4 years is pretty standard, starting from the moment of employment, with no additional terms. If they're not happy with your performance, they should fire you, rather than withholding shares. I think 0.6% of shares is quite low, and the tax reasons sound dubious.

> How do I make sure what I vest, I really do vest and they don't change the rules again?

The position of non-voting shares is quite precarious I think, because a voting majority in the company can simply dilute shares and render the STAK-owned shares less valuable. Besides that: just read the contracts, the STAK bylaws, and once you sign the certificate holder agreement it's relatively ironclad. I'd recommend getting some legal advice.


👤 jacquesm
I can't tell you for sure, but it feels off if the deal was changed compared to what it was stated as before. But you probably should have pushed a bit harder on them formalizing the STAK agreement earlier. Still, it could be nothing at all and maybe they simply aren't aware that your original deal was a different one, but such things rarely (if ever) happen by accident.

Also: there are ways to use a STAK to screw the stak certificate holders out of their rightful share during a liquidity event so make sure that you know who represents the STAK, ideally a notary public should be assigned as the administrator of the STAK, and not someone in the management. Best of luck!


👤 iforgetti
Hire a lawyer if you are serious. No advice here will compare. Hire a lawyer who specializes in work with venture funded startups.

👤 anamax
> So it is not only time-based now. (it was said this was for tax reasons)

You're about to find out exactly what terms you are on with the founders.

The easy way to find out if it's really for tax reasons is to find out whether the changes apply to everyone or just the peons. If they won't tell you, you know the answer and you know that they'll lie to you.

FWIW, if there is a legitimate difference between your terms and theirs, it's because real tax reasons apply more strictly to the folks at the top than the bottom. If your terms are worse....


👤 paxys
> I'm on good terms with the founders and I think it is possible to renogatiate this

You don't need to renegotiate anything. Simply hold them to the terms that were originally promised.


👤 lr4444lr
Wait, you're 2 years in, and you signed a contract to a different vesting schedule? This is setting off alarms in my head. Your equity rights are part of your comp., and what is earned in a prior agreement that was signed when you started cannot just be made contingent again by adding new requirements. At least not in the USA. I'd get a legal consult ASAP.

👤 AussieWog93
Just to add an alternative point of view: startup founders are not known for doing everything perfectly "by the books" in terms of legal/accounting stuff. It could just be laziness rather than the founder trying to fuck you over.

Of course, you know them better than any of us do. If you think it's an honest mistake he may have overlooked, just have a chat and it should be sorted for you.


👤 SOLAR_FIELDS
Related because it’s such a common refrain: Is it possible, as a founding engineer or similar, to structure the contract in such a way as to make your shares undilutable? I suspect the answer is theoretically yes, but would be interested in how it works out in practice.

👤 abbadadda
Do you have a lawyer? Have you ever had a lawyer look at any of these contracts? That is where I would start.

👤 faangiq
Most likely yea

👤 FearNotDaniel
First rule of con artists, poker players and startup founders: if you can't tell who the sucker is, it's you. Doesn't matter what they promise you, it's all smoke and mirrors and they can take it away or make it worthless any time they like. Negotiate the best salary you can, and don't give up a single cent of that monthly money in the bank against some empty promise of future riches. You already suspect they're lying to you, don't lose any sleep over it, just ask yourself if the monthly salary is worth the work you do and if not, go somewhere else.

👤 mongrelion
Reach out to Watson Parken, they are an Accounting & Financial Advice firm based in Zaandam. They will be able to give you the best advice you need for your personal situation.

Hourly rate is ok if you team up with the other engineers and pay the hourly fee together.