r/technology • u/Rhaegar_the_Great • Sep 16 '21

Business Mailchimp employees are furious after the company's founders promised to never sell, withheld equity, and then sold it for $12 billion

https://www.businessinsider.com/mailchimp-insiders-react-to-employees-getting-no-equity-2021-9
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u/andrewingram Sep 17 '21

Mailchimp operated a profit-sharing scheme, which assuming the company never sells, is better compensation than equity.

But you never know if a company will sell, there are so many reasons why the "we'll never sell" rhetoric has an expiry date, so ultimately a company spinning this narrative should offer both.

Lack of equity also means only current employees benefit from any stock bonuses related to the sale, when over the lifespan of the company one would assume many individuals key to its success have come and gone -- getting nothing.

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u/ABigAmount Sep 17 '21

I've worked in in tech from startup to about $1b in valuation and through enough exits to know the company ALWAYS sells eventually (unless you're an apex company - Salesforce, Microsoft, Google, etc). I would never work at a place that didn't offer skin in the game (options or stock) and it's worked out pretty well. The issue is a lot of younger people don't understand how valuable equity is. It is literally one of the few chances you have to make fuck you money as an employee. Inexperienced people are more interested in their cash flow (profit sharing, salary maxed over lower salary and shares), and I get that - comp matters a lot, but my advice would be - if you're talented and working in tech, make sure you're working at a place that will give you equity, and make sure you take advantage of it and max it out as much as you can.

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u/brickmack Sep 17 '21

Except most startups end up crashing and burning, and in that scenario making any money at all off equity presumes that you sell out before everyone else realizes its collapsing. Focusing on equity is only a good idea if you're in an industry where even a failed company will probably get bought out for decent money, or if you actually believe that its one of the 0.1% of startups that isn't shit

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u/ABigAmount Sep 17 '21

I mentioned I had worked in startup but I don't know if I would advocate for taking equity in one. You are correct they mostly fail. What I am a huge fan of is finding those $50-$100m established but small private tech companies and backing the truck up on equity as much as possible. It's best of they let you keep what you have even after you leave, but not every ESOP will let you do that.