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(Venture Beat)   Facebook raises $150 million to pay out employees who have toiled away at the company for all of two years   (venturebeat.com) divider line 36
    More: Asinine  
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5019 clicks; posted to Geek » on 18 May 2009 at 6:54 PM (5 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



36 Comments   (+0 »)
   

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2009-05-18 03:36:00 PM
He sounds like the kind of guy who refuses to buy store-brand cereal because it costs less.
 
2009-05-18 07:01:31 PM
I am so horribly angry that I will blog about it tonight on my livejournal.
 
2009-05-18 07:02:58 PM
Um...If you worked for a company and were given have internal (non-tradable)stock or stock options as part of your benefits package, and the value of your company went through the roof, you'd want cash in, too. Otherwise, those options or internal shares are worthless.

You would prefer the company renege on those shares?
 
2009-05-18 07:03:39 PM
Wait, why asinine?

Isn't the tradeoff of joining a start-up like that? You lose out on job security in exchange for the chance to make big bucks.
 
2009-05-18 07:04:00 PM
Sounds like it's getting to within several orders of magnitude away from CEO compensation.
 
2009-05-18 07:05:59 PM
Umm...

They're going to be buying back stock from employees who are getting a wee bit pissed that the shares they took as compensation a couple years ago won't be worth anything unless and until the company goes public, which isn't going to happen any time soon in the current market.

It's an effort by a company to play straight with its employees. The only thing asinine is that it's unusual.
 
2009-05-18 07:09:29 PM
The only way this is asinine is if you believe employees shouldn't share in their company's massive success.
 
2009-05-18 07:15:25 PM
Has anybody mentioned that this is not asinine yet? It isn't.
 
2009-05-18 07:15:39 PM
Sev79: The only way this is asinine is if you believe employees shouldn't share in their company's massive success.

Yes, but the massive success needs to come first.
 
2009-05-18 07:36:57 PM
stappawho: Yes, but the massive success needs to come first.

It's already a massive success. You'd know that if you follow my Twitter.

/have no idea if that's the "correct" phraseology
 
2009-05-18 07:46:16 PM
SeamusFerrell: Has anybody mentioned that this is not asinine yet? It isn't.

This. A 1000x this. As someone working for a private company with a metric fark ton of options, I wish my company did this. Approaching a decade at a "start-up".
 
2009-05-18 07:46:48 PM
English, motherfarker, do you speak it?
 
2009-05-18 07:58:05 PM
stappawho: Sev79: The only way this is asinine is if you believe employees shouldn't share in their company's massive success.

Yes, but the massive success needs to come first.


Actually depending on how they do this, this could be a zero-sum deal. When a company gets additional financing, they generally expand the equity pool(basically every one loses). If they are using the money gained from outside financing to buy back shares from employees, they are taking those shares out of the equity pool. In essence they are selling the employee's shares to outside companies and giving the employee the proceeds. From a business perspective this seems like a win-win all the way around. Employee's get some liquidity, early fixed share financiers don't get the shaft, you get more external inverters(this can be two edged), and you clear your books of a bunch of option shares.
 
2009-05-18 07:59:20 PM
investors..not inverters...damn you spell check.
 
2009-05-18 08:04:26 PM
The Gunslinger Roland: English, motherfarker, do you speak it?

No kidding.
 
2009-05-18 08:13:27 PM
Ahh tech startups. Where popularity with no business plan can still net you millions.
 
2009-05-18 08:17:18 PM
MyRandomName: Ahh tech startups. Where popularity with no business plan can still net you millions.

Hey, if it's so easy, try it.
 
2009-05-18 08:19:05 PM
SacriliciousBeerSwiller: MyRandomName: Ahh tech startups. Where popularity with no business plan can still net you millions.

Hey, if it's so easy, try it.


Just because I think it's asinine doesn't mean I think it's easy. I just think sites like that and Twitter who have no real business plans are not financially sound. They just run on popularity without a real business plan. Are you going to tell me Broadcast.com was worth the 1.x billion it sold for?
 
2009-05-18 08:19:30 PM
MyRandomName: Ahh tech startups. Where popularity with no business plan can still net you millions.

Why is that a problem? They had a very popular product.
 
2009-05-18 08:29:53 PM
Bliggedy-blogs, Facey-Spaceys and Twittery-pages.
 
2009-05-18 09:32:16 PM
MyRandomName: SacriliciousBeerSwiller: MyRandomName: Ahh tech startups. Where popularity with no business plan can still net you millions.

Hey, if it's so easy, try it.

Just because I think it's asinine doesn't mean I think it's easy. I just think sites like that and Twitter who have no real business plans are not financially sound. They just run on popularity without a real business plan. Are you going to tell me Broadcast.com was worth the 1.x billion it sold for?


I understand what you're saying. Popularity has no correlation with value for something that sells for nothing. The real question is how some of the douchebags who fund these deals were ever let near money in the first place.

Personally, I like Facebook, but the fact is that if it started charging, some other networking site would offer the same services for free. I say this because I doubt that advertising alone will carry it. That, and these things tend to come and go. I really have a hard time believing that it will be a long-term going concern. I guess that networking sites are new enough that we don't really know, although they seem to have signs of having a life cycle unlike many other popular web sites.
 
2009-05-18 09:53:08 PM
So if a public company does a stock buy-back on the open market it's a sign of confidence. If a private company does a stock buy-back it's an asinine hand-out to the people who least deserve the benefit, the employees who built the company.

The economics stuff is hard.
 
2009-05-18 09:54:56 PM
The Crack Kid: Wait, why asinine?

Isn't the tradeoff of joining a start-up like that? You lose out on job security in exchange for the chance to make big bucks.




That's what I'm still trying to understand. What's asinine about this? So what?
 
2009-05-18 09:55:26 PM
Smarshmallow: MyRandomName: Ahh tech startups. Where popularity with no business plan can still net you millions.

Why is that a problem? They had a very popular product.


...which unfortunately costs them more to produce than they can sell it for, and their competition is looking to undercut them.
 
2009-05-18 09:55:35 PM
KiwDaWabbit: I guess that networking sites are new enough that we don't really know...

Hold on, while I go ask the people who were involved (ie: investors) with tribe.net and friendster. (not sayin' you're wrong, just I don't know.)
 
2009-05-18 10:29:14 PM
I think they have too many employees, but then again I did watch a show about nothing that also had alot of people involved.
 
2009-05-19 12:15:25 AM
I'll give them another 20 million if they permanently get rid of those f*cking quizzes.

If I have to click "hide ___ quiz" one more f*cking time, I'm going to go on a violent killing spree.
 
2009-05-19 12:51:52 AM
As a start-up employee in Palo Alto, let me be the first to bid them good riddance from downtown as they sucked up every available parking space and empty seat at local eateries. I won't miss the blathering biz-dev schmoozing people believing their own egos and hype for a revenue model which doesn't exist.

I too work for stock options and yes I want to see value too but it's not a farking entitlement. You get your reward when you go public -- expecting something before your "leadership" can even figure out how to go cashflow positive is indicative of your priorities and your smoke and mirrors "business model".

Just thank god you have a job snowflakes.

You can't act like Google until you move revenue like Google.
 
2009-05-19 01:56:19 AM
I don't see anything that's asinine by rewarding your employees for their hard work. Lets see, they were given stocks at values less than 1 dollar. And after maturing for only 3 to 5 years, they're agreeing to buy each share for 10 dollars. that's a 1000% increase in value.
 
2009-05-19 05:04:20 AM
El Morro: I'll give them another 20 million if they permanently get rid of those f*cking quizzes.

If I have to click "hide ___ quiz" one more f*cking time, I'm going to go on a violent killing spree.


In a previous thread about facebook I'd brought up the same complaint and some savior offered up this facebook purity script that hides all those app results. I'd like to in turn help another kindred soul with this link to your salvation:

http://userscripts.org/scripts/show/44459
 
2009-05-19 07:28:08 AM
BumpInTheNight: In a previous thread about facebook I'd brought up the same complaint and some savior offered up this facebook purity script that hides all those app results. I'd like to in turn help another kindred soul with this link to your salvation:

http://userscripts.org/scripts/show/44459


You are a wonderful man, and part of why I come to Fark. Thanks to the vast majority of my friends using Facebook, I'm stuck with it until the next best thing comes along (as soon as possble, with any luck). Until then, I'll go with your option for now. Much thanks.
 
2009-05-19 10:14:43 AM
I like tater tots.
 
2009-05-19 11:26:40 AM
Sev79: Um...If you worked for a company and were given have internal (non-tradable)stock or stock options as part of your benefits package, and the value of your company went through the roof, you'd want cash in, too. Otherwise, those options or internal shares are worthless.

You would prefer the company renege on those shares?


Except in any absolute sense the shares are worthless.

With the exception of advertising how does facebook make any money? "I'm sure it'll turn a profit at some point!" seems to be the motto here.
 
2009-05-19 02:00:57 PM
That's capitalism subby. Remember, work done != money paid. See construction workers, high level management.
 
2009-05-19 02:13:41 PM
lohphat: As a start-up employee in Palo Alto, let me be the first to bid them good riddance from downtown as they sucked up every available parking space and empty seat at local eateries. I won't miss the blathering biz-dev schmoozing people believing their own egos and hype for a revenue model which doesn't exist.

I too work for stock options and yes I want to see value too but it's not a farking entitlement. You get your reward when you go public -- expecting something before your "leadership" can even figure out how to go cashflow positive is indicative of your priorities and your smoke and mirrors "business model".

Just thank god you have a job snowflakes.

You can't act like Google until you move revenue like Google.


If they can keep raising money for ever to operate then they can act like google without making any money.
 
2009-05-19 02:19:27 PM
Someone's lending them money? WTF?

Here's how a conversation would go if Facebook came to see me:-

FB: Good morning FarkerUK, we'd like to borrow $150 million.
me: let me get this straight. You borrowed a load of cash to help you develop a business, grew in size to the point where you're the largest social network on the planet with 200 million users, and you still aren't making a profit. Please tell me what's it going to take for you to actually make a return on what I lend you?

Seriously, I understand that businesses need finance to get started and advertise and so on, but if you can't turn a profit after a few years with 200 million users, you really should go home.
 
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