I think the equity/stock performance in the current tech markets is a bigger problem than inflation. Many who received stock grants in the last couple years have had their value cut in half (with some exceptions like GOOG).
Companies were giving equity grants based on inflated, sloshy market values. Why stay at a company where your $1MM (hypothetical) stock grant is now worth $400k when you can go to a new company and get a new $1MM grant at the current cheap market value?
I’ve been thinking the exact same. Changing companies is effectively “buying the dip” because equity grants are always normalized in dollar quanta terms. I’m wondering if the market has bottomed out or not since that’s the best time to switch companies.
> Changing companies is effectively “buying the dip”
well put.
I accepted an offer at a high-growth, public tech company in January. I talked with my hiring manager after the stock got hammered and we agreed to push my start date to April to take advantage.
Can you say a little more about this? You signed an offer letter in Jan and then you were able to get additional equity? How did moving the start date factor in?
In January, I negotiated an equity grant at a fixed value (hypothetically, $1 million, vested over 4 years). That $1 million value doesn’t change, it’s what my offer agrees to.
The strike price (value per share) is based on the average stock price N days before my starting day. If I started Feb 1st, the strike price would be based on the N days before Feb 1. If I push my start date to April 1st, it would be based on avg stock price N days before April 1st.
I would rather get $1mm worth of stock at $60/share than $1mm at $110/share, for example.
This is a huge part of the dilemma for me. My equity has, on average, traded sideways. Equivalent offers or even worse offers from companies with better stock performance could end up being worth materially more.
> or even worse offers from companies with better stock performance
not as relevant IMO. Overcorrections might be better than current performance. Example, now is the best time to join Robinhood, get an $800k stock grant at $12/share. If it goes back up to $50/share like is was last year then that $800k would be worth $3.3 million.
Companies were giving equity grants based on inflated, sloshy market values. Why stay at a company where your $1MM (hypothetical) stock grant is now worth $400k when you can go to a new company and get a new $1MM grant at the current cheap market value?