Poll: How much money have stock options brought you?

https://news.ycombinator.com/item?id=5651279

by GuiA • 13 years ago

77 68 13 years ago

news.ycombinator.com

galvanist• 13 years ago

So I think you mean stock option grants... because otherwise you should have an equal number of choices for negative values.

leishulang• 13 years ago

stock call options? where are the negative options?

niggler2• 13 years ago

Depends on what you mean by stock options. I imagine quite a few people here trade single-stock (e.g. AAPL https://www.google.com/finance/option_chain?q=NASDAQ%3AAAPL) options.

aaronblohowiak2• 13 years ago

They mean ESOs or RSUs

bradly• 13 years ago

RSU's are different that stock options, no? I answered zero as I have never had anything come from options, while RSUs have been very nice.

steven2012• 13 years ago

I made over 6 figures from a post-IPO, listed company.

propelledjeans2• 13 years ago

So, 7 figures?

coolsunglasses• 13 years ago

Probably still six figures. A lot of people have "$100k" in their heads when they say six figures. So when they say "over six figures" they often mean $200k-900k, not literally seven figures.

Uhhrrr• 13 years ago

Hm, I suspect you will get a lot of "$0" answers from folks who have only been out of school since 2008, and much higher answers from folks who were in the Valley pre-2001.

lifeguard• 13 years ago

I have only had above water options at one of three start-ups I worked for.

Pre-IPO stock options should be viewed as lottery tickets unless one is a founder. Still, they motivated me.

jtbigwoo• 13 years ago

I made about $2,500 for 2000 shares once when my company was bought out and was promised $50,000 more if the company hit certain milesones. We did not hit said milestones.

smackfu• 13 years ago

Sad thing is that if I had sold all of mine on the last day I could exercise them, I would be in a different category.

But what are you going to do, that's super risky. No regrets.

jorgeortiz85• 13 years ago

You should add options for negative quantities too. You can pay money to exercise options and never get that money back.

frozenstorm• 13 years ago

Indeed. As well as perhaps an poll selection for options you've exercised but do not know yet what you'll get for them (company still running but haven't had opportunity to sell shares).

georgemcbay• 13 years ago

You can also get really nailed on AMT depending upon timing, even in situations where the stock ends up underwater and worthless before you can be rid of it.

philipwalton2• 13 years ago

There should be an additional choice for people who have options but aren't able to cash them out yet.

That would offer a view into the percentage of people who stay at a startup long enough to exercise their options.

jedberg• 13 years ago

There is an option for you. $0. You haven't made any money yet from options.

philipwalton2• 13 years ago

Yes, but there's a difference between your options being worth nothing and the value of your options being unknown. There's also a difference between the value of your options being unknown and the value of your options being known but you not being able to exercise them for whatever reason.

You may not care about that distinction, but I'd be interested to know what camp those "$0 :(" people are in.

rootsofallevil• 13 years ago

My stock options are reportedly worth $230 but I'd hate to think how much I would have to pay to get the money into the UK, probably not worth it.

ChuckMcM3• 13 years ago

Perhaps this is the wrong question, there are "how much money did you make on your options" and there is "How much money would you have made if you had sold them when they were worth the most?"

You see I had some Sun stock left over from working there (about 8,000 shares) which at $60 a share in 1999 was $480,000, but after a reverse 3:1 split and selling them at $6 each in the Oracle merger they only netted me about $16,000. I "could" have sold them when they were $480,000 but I didn't. Not as severe a challenge as some folks in the dot com implosion but its something I think about from time to time.

If you ask what was the most money your options were worth on paper you get another (often higher) number. So if you were a Zynga employee on the day they went public you had some big value that they were worth but you couldn't sell until much later, and much later they were worth much less.

I owned 30,000 shares (common, not preferred) in a startup that I advised which when it was acquired only met the liquidation preference for the preferred (common stock ended up being worthless). At the last round of funding it was 'valued' at about $150,000 though. :-)

The bottom line is you can drive yourself crazy with possibilities if you aren't careful.

niggler2• 13 years ago

Ultimately the only question that matters is how much money was made. Dwelling on fantasies is immaterial (until you can sell or find a way to lock in the price, the market price has no bearing on your actual value).

In your example, you can say whatever you want about how it was worth more than you actually netted, but at the end of the day all that matters is the fact that you realized 16K

rm999• 13 years ago

Looking at the maximum value normalizes for someone's risk profile and financial luck/common sense. I agree with you that for your personal finances all that matters is how much money you got or can get, but normalizing for these factors is useful in a poll.

jfb2• 13 years ago

I don't like to think about this, because my first tranche of AAPL options were valued at ... $42.

cpncrunch2• 13 years ago

I suspect your salary over the years netted you a heck of a lot more than your stock options. I did 3 years of contracting in London 15 years ago (after barely out of school), invested the money, and ended up with about $150k due to a favourable FX rate at the time.

These days it seems that every man and his dog is earning $150k+ if they're a half-decent developer in silicon valley, so I guess the stock options don't really matter. (I earn a lot less than that myself now, because I run my own mildly-profitable business).

It makes you wonder whether stock options are really just like throwing a dog a bone. The only people who really make any money are the investors and founders. At post-IPO places like facebook and google the stock bonus is really just an add-on to your salary. When I look up 'senior software engineer' salaries at google, you typically earn around $250k including stock bonus, so if you're looking for money I guess that's where you should be :)

ChuckMcM3• 13 years ago

Except that it's not a choice of 'salary' or 'stock options' it is 'salary' or 'salary + stock options'. I can say pretty confidently that I've earned more with salary + options than I would have as a consultant with just salary.

To date I have made at least as much money with Sun options as I made in salary (I worked there 10 years). At some level, some of my current savings can be traced back to those options so they are in principle (pun intended :-) still earning me money.

marssaxman• 13 years ago

Ha, ha, ha, stock options. Heh.

tibbon2• 13 years ago

I think the meta-meta question here is regarding the value of stock options vs immediate compensation (salary + benefits). So many CEOs treat options like they will definitely be of large worth to a person- but for the average employee they'll never see anything from them.

jfb2• 13 years ago

I've never seen a dime from equity from a non-publicly traded company.

jrdn• 13 years ago

Yup. It's also really kinda entertaining how offended founders get when you ask for more money instead when you're employee #53 and they offer a number of options but refuse to disclose what % of the pool that is.

tibbon2• 13 years ago

In a small company, if I can't see the cap table- then I don't want to talk about shares. No investor would touch a deal if they didn't have access to it, and I'm investing my time.

icedchai• 13 years ago

Where's the negative ($<0) option? I paid for some options and they were worthless.

tunesmith• 13 years ago

Same here. Exercised at $3, never sold. They went down to $0.02 and more recently back up to $0.40. Could have made a lot had I bought at $0.02. I regularly tell myself to just sell the damn things so I can stop looking at the ticker.

rdl• 13 years ago

You might want to be more precise -- founder's stock, RSUs, private company/incentive options/nsos, and public traded options are all different and the same.

I've never actually received private company options; it's always been founders shares, even in a post-A company.

I've made maybe 600% on my money trading options (mainly AAPL and some non-tech companies; lost on TSLA but made money on TSLA stock), which is probably not what you meant.

codex2• 13 years ago

More than twelve users have sold stock options for more than $100M? Hello Larry, Sergey, Eric, and Tim! I would have suspected you were too busy to read HN.

JOnAgain• 13 years ago

If they've netted that much, that means they've sold. As such, there's a good chance they've retired, or at least only work on their own side projects now. Not everyone sells a company and then starts another one.

Also, rich people have access to the same internet. Is there an "interesting shit about programming but only for rich people site" that I don't know about?

codex2• 13 years ago

The number of people who have sold more than $100M in options (as opposed to founders' stock) is likely quite small, no? The poll is now up to 38.

hello_newman• 13 years ago

I wonder if it is true, or if it is someone just clicking on it for shits and giggles. I've often wondered who exactly reads HN.

mixmax3• 13 years ago

HN is the best tech news aggregator on the net. Where do you think Larry, Sergey, Eric, and Tim get their news from?

There are probably a lot more household tech names on HN than you'd initially expect.

citricsquid• 13 years ago

Every time polls happen here people openly vote for every option to "show how broken the HN poll system is" and to "prove that PG should make it so only one option can be selected", every now and again people gloat about doing it. It's really really lame.

nilsbunger• 13 years ago

If you had a (very) successful company exit where you made more than $100M, you would stop reading HN?

hyperbovine• 13 years ago

Pretty sure I would double up.

wging• 13 years ago

Who is Tim?

sootzoo• 13 years ago

Tim Cook, I'd imagine.

PaulHoule• 13 years ago

Ought to have an option for people who lost money trading options.

swinnipeg• 13 years ago

$0, had them with 2 different companies, both became worthless.

columbo• 13 years ago

I have a check for 1,000 shares, grand total $14.99 :) issued to me on January 2002. So yeah, 1.4 cents a share.

I still have the check somewhere, I never cashed it, I've always been meaning to frame it.

propelledjeans2• 13 years ago

To what company?

zerr• 13 years ago

Selling the stocks is the one-time operation, right? So you get paid once...

Is there any other scenario, when you get % of revenue constantly, e.g. on a monthly basis for the rest of your life? i.e. even if you leave the company (maybe after some vesting period).

Here, I say "revenue", because in case of "profit" the company can reinvest it, leaving you with nothing.

EDIT: So basically, is there a way to transform your employment into a passive income?

aetimmes• 13 years ago

Stock dividends come to mind. Not sure how common that is in the industry, though.

geuis• 13 years ago

$19 and some change. That's it. It's also why stock percentage is pretty meaningless to me anymore. Give me cash, or give me bitcoin.

stevewillows• 13 years ago

Over the years there have been several people in here who turned down options for, what would become, major players. iirc there was someone who turned down stocks with MS that would currently be worth upwards of $320m.

Sometimes it's difficult to get out of the endless loop of 'if only...'

swalsh• 13 years ago

I made some money speculating with options in the public stock market, does that count?

The ones I got at my company have so far netting nothing yet :)

mikestew• 13 years ago

Though my answer should be prefaced with having started at Microsoft in the 90s. Options I've received since then have returned goose eggs.

mixmax3• 13 years ago

I think someone's skewing the poll.

Personal wealth follows a powerlaw distribution, and there's good reason to believe that income from stock options is somewhat similar. If you look at the numbers above they make reasonably sense except for the "in the hundreds of millions" which is far too high compared to the others. The "in the hundreds" and "in the thousands" should be higher, but I'd wager that that can be explained by people not getting stock options in the hundred or thousand dollar range. The paper work alone would cost more. It's expected that there are a few, since a stock can tank, so stock options initially worth millions can turn into thousands when cashed in.

bsims• 13 years ago

I don't think it necessarily has to be evenly distributed. If you think about options people probably either A) Made a good amount of money or B) Made none at all. Most companies issuing options are likely venture backed and not going to settle for a marginal gain. Thoughts?

FireBeyond• 13 years ago

Maybe there's some old school Microsoft types, etc., because other than that I'm skeptical that only 8 people have made 'tens of millions', but 35 have made 'hundreds of millions or more' (or that 35 have made that at all)...

mixmax3• 13 years ago

I think it is, based on the fact that (as I mentioned in the GP) wealth follows a powerlaw distribution. I don't see why options wouldn't follow this trend, particularly because market cap of companies in an economy also follows a powerlaw. These are the two factors involved in options.

ealloc• 13 years ago

Actually, wealth follows an exponential distribution for the lower 95% of individuals (by wealth) [1]. However, yes, it does follow a power law for the 5% richest.

[1] http://arxiv.org/abs/cond-mat/0103544

slm_HN• 13 years ago

I guess you're asking for a total, which would be tens of thousands. However that's comprised of one success and a lot of companies returning $0.

BrainInAJar• 13 years ago

I happily negotiate away stock options in favour of signing bonuses or better still, salary.

I don't want your equity. Pay me.

arbuge• 13 years ago

My answer was tens of thousands. That came from my blue chip company (TI) options back in the day.

Founders stock would have been a different story...

shiftb• 13 years ago

It depends on whether you're asking about sold options and actual cash or what unsold options are worth on paper.

I imagine the two amounts are significantly different for many people.

Poll: How much money have stock options brought you?

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