The lack of public information about startups means that the value is uncertain, and that’s a reason for a candidate with no special insight to discount the stock heavily. On the other hand, in the job seeking/networking process you may be able to find out important nonpublic information, which could provide an opportunity to legally “insider trade” by joining a company with a lot of upside that hasn’t yet been reflected in the valuation.

Yeah I do do that, but you have to risk more and I disagree about it being easier to value from the outside.

Public markets for non-dividend paying stocks are also betting more on what other people think the stock price will be rather than the company value itself - it’s a bit of a different game.

> Yeah I do do that, but you have to risk more and I disagree about it being easier to value from the outside.

I don't know. To me, wasting my time (AKA - my life) seems more risky than anything. On top of that - when you do exercise your options that you earn, you have to pay $$$ for them anyway. (Along with paying AMT - yay!) I'm pissing away a third of my net income on my options + tax right now. Who knows if I'll get jack shit. At least with the stock market I can usually get SOME of my money back unless you're doing something super risky like playing with options.

IMO - playing the market is less risky than playing the startup game. Especially if you're joining early startups or ones that haven't just been straight up rockets.

Have you seen the bloodshed in the NASDAQ lately? It's wiped out quite a bit of wealth... although it was fairly overheated and tech was due for a major correction, but damn watching those gains come down was painful. :/

Still not close to the very common experience of having equity you worked years for cash out to nothing!

Or less than nothing: I paid to exercise my options when I left my first start up, and they were eventually worth much less than I'd paid.

We have similar experiences. I might disagree with advice to college grads to not pursue a startup though. It can be more fun, and if you are going to be tempted by it it's good to take the hit in your 20's when (probably) it doesn't matter too much.

> We have similar experiences. I might disagree with advice to college grads to not pursue a startup though. It can be more fun, and if you are going to be tempted by it it's good to take the hit in your 20's when (probably) it doesn't matter too much.

I'd take FAANG over most any startup and would've if they had given me an offer. I speak as someone who has been in 3 startups before they were 30 (seed stage to unicorn). I think startups (startups that have high chance of no exit - <$500 mil valuation, less than 100 employees, <50 engineers) are better suited for people who have significant experience. If you join a startup - it is frequently filled full to the brim of FAANG rejects, young people who don't realize what FAANG offers, and people from different industries trying to break into tech... which means it's almost always the blind leading the blind. You will not learn best practices, you will inevitably find it very hard to switch into a big company, and your resume will look like shit (meaning you will always get subpar offers/interviews) until that startup either becomes a rocket ship OR you join a big co.

Risking your 20's in hopes you get ultra rich is a fools errand when you could reliably get $350K+/yr by 30 when joining FAANG when you're in your early 20's. No startup is going to give you an offer that will even be good anyway! There's no way you're going to join a startup as a entry level engineer and get an option package that will be worth anything.

Well yeah don’t waste your life, equity should be one consideration among many when choosing a place to work.