OK, job advice requested

[Sue J]

Yikes! Are they paying everyone with company stock or are some still getting paid with real money? Not a lot of people can live off their savings for a few months like you are doing.

Good luck with the interview. If you do get another job will you keep the stock that you've already been issued?

I also vote for a plausible reason to take a vacation day or personal day. I wouldn't lie about an illness, but if asked for the reason I'd be prepared to say something like a cable or utility company appointment or something related to the kids.

Or....since your "income" has disappeared you have to see your lawyer about changing your child support payments.

[Bestwifeever]

Just curious, what happens to your stock options if you leave?

[growing_older]

Hopefully this is actual shares of stock, not options.

[SecondCor521]

Thank you all for the replies and input.

First, it occurred to me this morning while I was mowing the lawn that I really have to attend the interview -- I may like the job at company B better, get a significant raise, and get paid in cash. Duh.

I also realized that as a newly minted employee at company A, I do have a use-it-or-lose-it personal holiday and my kids need to drop off their school supplies at school on Friday.

Finally, I tallied up all the votes here and the overwhelming choice was in favor of taking a personal day, and not being upfront.

Therefore, I've told company B that I'll be asking for this coming Friday off from work. I'll ask company A on Monday, but I'm 99 44/100% sure they'll let me take my personal day.

My boss certainly may "see through it", but knowing him he'll understand both why I'm interviewing and why I'm not telling him I'm interviewing. What has gotten me into this bind is telling company A why I've taken time off in the past -- "I'd like Thurs/Fri off to visit my sister", "Can I take a long lunch Thursday? I have a dentist appointment" -- in order to be as dedicated as I can be. So now when I ask for time off without an explanation it creates a question in their mind. Oh well, c'est la vie.

Now to clarify some things and answer some questions:

I'm not working at Company A for stock because I am friends with some of them. I'm working there because it has been my best employment option for the past year or so, and I really think they have potential. The fact that I am friends with some of them and really like working there, among other factors, just makes leaving harder, that's all.

@bbbamI, yes, they know I have children. Company A is only about 15 people, so we all generally know each other's family situations. They also know I have a mortgage and child support payments, I've said that several times. Without getting specific, I've also said that I can only do the 100% stock thing for a few months.

@freebird, yes, I think it's legal. Technically I can adjust my ESPP contribution any time, and just as technically they can lay me off for lack of cash flow. And yes, I'm under a court order for child support for the next eleven years or so until my youngest graduates from high school. Thanks for the good wishes! Oh, and I don't think company A would lay me off to get UI for a couple of different reasons: it would make their UI insurance bill go up, and they'd want me to close out the 12 different projects I am working on before moving to company B.

In general, a few facts about company A:
1. Their sales have grown by about 100% over the past two years.
2. Sales are on track to grow by about 50-75% this year. Could be another 100% year if certain events occur -- we have several large customers evaluating our technology for use, any one of which could double our sales/month.
3. The company has received ~$6M in angel investment from several very reputable angel investing consortiums in two rounds of funding.
4. I've worked at six different companies in at least ten different teams over the past fifteen years and this group of folks is probably tied for the best group of folks I've worked with.
5. Several others in the company are also working for stock.
6. The product is better and cheaper than the more-established competitive products.

@W2R, good advice, thank you. I think I may have been letting them somewhat take advantage of me because the job market here had been bad, and I really don't like looking for jobs.

My arrangement with company A: They're paying my taxes and health insurance for me and my kids. Because of the way I've structured things, I'm in reality getting maybe $500 a month in actual cash. The rest I get in preferred shares at a price that has been determined by an independent accounting firm. From what I can figure, if I work there for a few months for stock (I just started the stock deal on 8/1), I will perhaps own 1-2% of the company.

@T-Al, will do so on this thread.

@quietman (and others), I do realize this deal is unlikely to pay off. I think it could be worth the gamble.

@SueJ, my impression is that the lower-paid folks are getting paid in cash and the directors are taking a combination of stock and cash, depending on their own arrangements with the company. If I take the job with company B, I assume company A will either issue me the shares I have earned or perhaps less likely will just pay me in cash to avoid the paperwork of another shareholders. Thanks for the good wishes!

@GO/BWE, yes, these are actual shares, not options.

One other thing -- I alluded to this a little in my original post, but I don't really like company B. They treat their employees disrespectfully, they're in a commodity business which goes through boom/bust cycles which result in mass hirings and layoffs, and the product I would be working on does not provide the value to society that company A's product does. However, they do pay very well. Some of my angst is due to me wondering how much I really want to work for company B anyways. But then I realized I needed to at least have a conversation with them to find out more.

Thanks again to everyone. I'll post to this thread as things develop.

2Cor521

[SecondCor521]

Oh, and I did have a way out of the box idea -- if company B wants to hire me, see if I can work half time at company A and full time at company B, or the other way around. Could be an option, but I realize I'd have some selling and careful discussions to make that work.

At this point it's all preliminary anyway, but I like to think about these things as much ahead of time as possible. I'm not a quick-on-my-feet kind of guy.

2Cor521

[REWahoo]

Quote:

Originally Posted by SecondCor521 Oh, and I did have a way out of the box idea -- if company B wants to hire me, see if I can work half time at company A and full time at company B, or the other way around. Could be an option, but I realize I'd have some selling and careful discussions to make that work. At this point it's all preliminary anyway, but I like to think about these things as much ahead of time as possible. I'm not a quick-on-my-feet kind of guy. 2Cor521

Better think long and hard before discussing this with your prospective new employer. While you may see it as sharing your skills to help out both companies, the new company is likely to view it entirely differently. It could call into question your commitment to giving 100% to your new job.

[Nords]

Quote:

Originally Posted by SecondCor521 In general, a few facts about company A: 1. Their sales have grown by about 100% over the past two years. 2. Sales are on track to grow by about 50-75% this year. Could be another 100% year if certain events occur -- we have several large customers evaluating our technology for use, any one of which could double our sales/month. 3. The company has received ~$6M in angel investment from several very reputable angel investing consortiums in two rounds of funding. 4. I've worked at six different companies in at least ten different teams over the past fifteen years and this group of folks is probably tied for the best group of folks I've worked with. 5. Several others in the company are also working for stock. 6. The product is better and cheaper than the more-established competitive products.

A few startup questions that you may or may not be able to access the info to ask yourself:
- How much cash does the company have and what's their burn rate? Do they have enough runway to make it to some goal or deadline?
- Where are they on their next round of funding? Any VCs sniffing around? Or are they still suckering soliciting angel money?
- Are they paying their FICA taxes? The reason I'm asking is because if they can't afford to pay you any payroll then it's entirely possible that they can't afford to pay the U.S. Treasury any payroll taxes either. And if that's the case, it kinda puts a chill on the fundraising for the next round...

[SecondCor521]

@REWahoo, yup, good point, which is why I think long and hard about these things! Coincidentally, company B is unlikely to be understanding.

@Nords, without getting into details...

-- the company has on the order of a few months to a year of cash at its current burn rate depending on sales, but the burn rate has been dropping and we're close to break even cash-flow wise. Do they have enough? Depends entirely on how sales go the next few months.
-- They don't want any more funding and hope not to need it. They've gone through two rounds of angel funding already and my impression is that now is make-it-or-break-it time.
-- I believe so. From everything I've seen over the past year or so, this company does things properly, and I very much respect and trust the controller.

2Cor521

[freebird5825]

Quote:

Originally Posted by REWahoo Better think long and hard before discussing this with your prospective new employer. While you may see it as sharing your skills to help out both companies, the new company is likely to view it entirely differently. It could call into question your commitment to giving 100% to your new job.

I'm in lockstep right behind REW on this.
Mum's the word about retro-j*obbing to Company A. What you do after hours and on weekends has to be your business and nobody else's in this case.

[target2019]

Glad to hear you will go to the interview. Sounds like you might have another tough decision, but will cross that bridge in a week or two.

The environmentals are nice to know, namely, that you like Company A, while Company B is tough on its employees. However, you have said that you can't work for stock beyond a few months more, and it doesn't sound like Company A is going to cross a threshold and pay you the same wage as Company B. So, looking beyond all of the variables, you simply have to make a move if Company A does not begin paying in cash. Though all of the discussion, it seems that you must find a way to get paid.

[Nords]

Quote:

Originally Posted by SecondCor521 -- They don't want any more funding and hope not to need it. They've gone through two rounds of angel funding already and my impression is that now is make-it-or-break-it time.

I hope so. I know of a couple of "any day now" companies working on angel round "F", let alone "C" or "D". The "ruh-roh" is that frequently the founders get all stubborn about not selling off any more pieces of "their" company, and they don't have enough fundraising time left when it becomes apparent that they need more money. The VCs can smell their fear & desperation, too.

Are you employees kept informed of the exit strategy? If you leave Company A before a certain date, does your stock have clawbacks or other restrictions? Would you be able to register it for the IPO someday or would you be required to sell it back to the other company's shareholders at what may or may not be a good price, especially if they're scrambling for a down round?

The essential conflict here seems to be that you can work for love or you can work for money-- but not both at the same time.

This may become moot when you ask more questions about Company B's treatment of its cubicle drones employee policies & benefits. It sounds like you're already networking their current/former employees. Even if B offers you the job you may not want to work for money under such crappy conditions as you seem to perceive. The idea of showing up for work where they disrespect you but pay you a lot of money... well... that just reminds me of the Navy's submarine force.

Conventional wisdom is that employees who are considering leaving a company, but end up being persuaded to stay for more money, only stay another 12-18 months before moving on. It's already considered bad form to blackmail your current employer with a prospective employer's job offer, and the conventional wisdom is to not negotiate under those terms.

But it sounds like your current company is already on notice that you won't take stock forever. At some point in the next few weeks it would seem like a good idea to take your boss to lunch for a quiet discussion about B's offer and how you don't want to be subject to those working conditions for a lot of filthy lucre... but now that you're reaffirming your loyalty to A, you have to know when you're going to resume getting paid in dollars. Maybe even more dollars.

Even angels, let alone VCs, are accustomed to pouring their money down eight or nine rat holes before one starts gushing cash. It's a lot harder to live that lifestyle that as an employee. The challenge is not to get your heart broken while you're working for love...

[FUEGO]

As long as Corp B doesn't have an explicit prohibition on outside employment or contract work, I don't see a problem with staying on part time/limited time with Corp A to continue the work. And you can get paid in stock without worrying too much about income (Corp B would be providing that). But I would keep Corp A PT work to nights/weekends and not mix Corp A work with corp B work at all. And this assumes corp A and B are not in the same line of biz or competitors or anything.

[Texas Proud]

Quote:

Originally Posted by SecondCor521 My arrangement with company A: They're paying my taxes and health insurance for me and my kids. Because of the way I've structured things, I'm in reality getting maybe $500 a month in actual cash. The rest I get in preferred shares at a price that has been determined by an independent accounting firm. From what I can figure, if I work there for a few months for stock (I just started the stock deal on 8/1), I will perhaps own 1-2% of the company.

This screams to me there is something you are not seeing... how does these preferred shares become common If you do not have common, then you are not in the position of an owner... and I can not see how you would be able to get 1 to 2% of any company with a few months work when you say they have had millions of dollars of funding... this just does not add up in my head...



And I would not trust the independent accounting firm... there was one who valued the company I work for... and all they did was do a NPV of cash flow the last few years projecting forward a few years..... since you say you company has 100% growth, then it appears that the 'value' is a lot higher than reality... and not paying people makes it look even more valuable....



My question would be.... what if you went back to the powers that be and said "I want to get back on cash salary".... if the answer was 'fine'... then no problem.. if there was any hemming and hawing..... or a flat out 'NO'.... I would move to company B and start to look for company C if the work conditions are what you say they are....

[SecondCor521]

More replies:

@target2019 and others, yes, getting paid sometime soon is important. I wonder about whether I should go back to company A about getting paid in cash before or after the job offer from B (if it happens), and whether or not I should inform them of the offer from B. More thinking to do there.

@Nords, yes, I see the same issue you do. I think the CEO does as well so we are trying to succeed rather than become a rat hole for the shareholder's money. Exit strategy is to sell out to a larger company a few years down the road, once we've built the company up somewhat. No clawbacks or restrictions in the paperwork that I saw...I just am a straight-up shareholder. I also believe I can sell it for whatever value I think is there -- of course, given that it is privately held etc. the value may be quite variable. I am considering the "quiet conversation with the boss" that you describe. I'm certain he would understand the situation well -- he and I are very much on the same wavelength.

@FUEGO, the two companies are not competitors, so I could probably continue to work nights/weekends for company A.

@Texas Proud, my mistake, they are regular common shares. And the 1%-2% was a guess, and way too high as I think about it. It'd actually be a fraction of a percent. Your (and others previous) point about accepting stock as a proxy for loyalty makes me think maybe I've been too much of a starry-eyed chump.

Thanks again to all, will keep you posted.

2Cor521

[dgalbraith100]

I've been following this thread with interest. Here a bit of my long and rambling work story:

I have been working for a startup company for the last 5 years that has paid me a significant % of the company in shares (I'm 1 of 5 founders), but no actually $$. Only 2 of us are left doing anything significant with the company. So I "own" a good part of the company. (Who knows what is real "value" is... more than 0, less than billions.)

I don't know if we will every "make it" or not, but I continue to put in anywhere from 10-50 hours a week. (depending on whats needed). Most of the time because the "product" is complete its closer to the 10 than the 50. Every now and then we put in a new feature, a serious bug is found... whatever.. and 50 hours happens.

I also started a "real" job about 9 months ago. A friend that use to work for me, told me that the company he is working for was looking for a sysadmin. Wanted to know if I was interested. I told him sure, but I only want to work 25 hours a week. (partially because of my other "job" partially because I enjoy my free time). The deal was that I was going to stay on for a couple months (they said 3, I figured 6) and help train a current employee in Unix (he was a windows help-desk person). I would then leave (This was one of the big things that managed to draw me in was an exit plan, and their willingness to train an internal employee and create a nice career for him). Things changed, the guy I trained got a Unix admin gig somewhere else and I am still there... and I am actually enjoying myself. So I was his boss, now he's my boss.. Life is so much fun.

One job is Unix admin, the other is software/web development, both things I enjoy. So since I don't need the $ (or the shares) and both companies know it, I don't get pulled into the work "crap" near as much as I used to. (probably helps that I'm not managing anybody to)

The "$" job gives me a little extra spending money, some extra savings money, and some human interaction which my "shares only" job doesn't give much of.

I've known my business partner for 20+ years, (long before we started the business) and he gave me some advice a few years after I met him that has turned out to be true each time I've used it. If you are good at what you do, companies will give you just about whatever you ask for to keep you happy. (except for more $)

I worked for a university as my first job (10 years). I got an job offer to go to a private company, but was hesitant. I talked to my boss before I accepted and asked if he would be willing to put me on unpaid leave for 6 months while I checked out this other job. He said... Yes... because he wanted me back if the other job didn't work out. (The job did work out, but I did do a couple projects for the university as well, so I think we both benefited from that deal)

In that job after 5 years I had the opportunity to do the startup company. So I told my boss that I really needed to go hourly and only work 20-25 hours, and I wanted something less "on-call" like more in the software development group. They moved me from managing the sysadmin group to web development and I stayed with them for about a year until the startup consumed all my available time.

When I got hired in my current "$" job, I told them I could only give them 25 hours, and based on the recommendations of my ex-employee about my abilities they decided to hire me even if it wasn't for the 40 hours they wanted.

So my point is, if the people in your current job want to keep you, and the people in the new job want to get you, there might be something you can arrange to give everybody mostly what they want, and find the best of both worlds. I think you have the right idea thinking outside the box. How to fit the puzzle together I don't know, to many factors of who you know, and what they think of you.

I'd be really hesitant to try to keep it all a secret. It was easier for me in that I was entering the "negotiations" knowing that I didn't need $ out of the deal.That makes it easier to say, "The job sounds really interesting, but I can only be there for 25 hours a week. I have other interests that I'm unwilling to give up. I have kids, so my hours can be X-Y"... "and I'm happy to work for only 3-6 months training my replacement".

So, not knowing your relationship with your boss, or your CEO, I can't say if you should tell them or not that you are looking. Only you can make a reasonable guess as to how your boss, or the CEO would react to this. Would the current company support you, try to keep you, but see that the current $ issue they can't keep 100% of you. Do they like to look for outside the box solutions, or if they would fire you on the spot because of your "lack of loyalty". You will be the best judge of this, not us here . If you trust your boss he might be a good judge of the CEO.

We also don't know your relationship to the new company, and what they "think" of you, which plays a role as well.

I thought I'd just share my story so you know there are other outside the box ways of doing this. Keep thinking about whats best for you, and whats best for both companies, and can you come up with a middle ground to get everybody something.

Laters,
-d.

[Westernskies]

Quote:

Originally Posted by SecondCor521 Therefore, I've told company B that I'll be asking for this coming Friday off from work. I'll ask company A on Monday, but I'm 99 44/100% sure they'll let me take my personal day.2Cor521

...the most amazing thing happened to me on Friday. You won't believe who I ran into when I took the day off to buy school supplies for the kids.... What are the odds of bumping into a recruiter for company B at the Boise Walmart on a Friday afternoon?

[Milton]

Quote:

My boss certainly may "see through it", but knowing him he'll understand both why I'm interviewing and why I'm not telling him I'm interviewing. What has gotten me into this bind is telling company A why I've taken time off in the past -- "I'd like Thurs/Fri off to visit my sister", "Can I take a long lunch Thursday? I have a dentist appointment" ... So now when I ask for time off without an explanation it creates a question in their mind.

Perhaps you're right. But don't be too quick to assume that your boss will spend much time considering why you are taking a day off without volunteering specifics. We all have a tremendous capacity for self-absorbtion, and he likely has his own concerns that take priority over analysing the vacation plans of his subordinates.

Quote:

At some point in the next few weeks it would seem like a good idea to take your boss to lunch for a quiet discussion about B's offer and how you don't want to be subject to those working conditions for a lot of filthy lucre... but now that you're reaffirming your loyalty to A, you have to know when you're going to resume getting paid in dollars. Maybe even more dollars.

Too much of an ultimatum, IMO. Even if A meets your terms, there would likely be substantial resentment that may hurt you in the long term.

I agree that it makes sense to tell your boss that they need to resume paying you in cash; but I'd leave out the specifics about B's offer (assuming it makes one).

[SecondCor521]

Quote:

Originally Posted by TromboneAl And don't forget to keep us posted.

Had the interviews today -- one softy with the recruiter, one softy with one of the team engineers, a technical interview with two senior engineers, and then lunch and a chat with the manager.

Overall things went well and my impression of the company was much better than I thought it would be.

I will hear next Tuesday or Wednesday one way or the other.

At this point I think there is about a 70% chance they'll offer me a job, and if they do I think it will be for about 30-40% more than what I make now, with better benefits.

If they offer me the job, I think my current plan of action will be to accept the position with company B and when informing company A offer to work nights/weekends for them for stock. That's the best I think I can do.

2Cor521

[kumquat]

Quote:

Originally Posted by SecondCor521 If they offer me the job, I think my current plan of action will be to accept the position with company B and when informing company A offer to work nights/weekends for them for stock. That's the best I think I can do. 2Cor521

Sounds good if it happens, congrats.

[freebird5825]

Good plan - no bridges burned. Follow the money...

Good luck and I hope Company B comes thru for you.