[JonFish85]

If "the number" is, say $220m, it could be a number of things. If it's cash today, others have done the math on how things could get divvied up.

The "top line" number can mean a lot of things though; it almost certainly includes the assumption of hitting several targets, some of which are reasonable and some are probably stretches. It's also a very real possibility that the "real" cost that Chase paid was just the right amount to make the common stock evaporate; investors get their money back such that $0 is split amongst common stock. Employees then are given a sheet to sign saying that their stock in WePay is now worth $0, but here's an offer for Chase stock vesting over 4 years.

Anecdata, for sure, but most of the deals I've seen have been something like this. The top-line number is all well & good, but the real dollars people extract from it are invariably less (again, just in the limited set of things I've seen). I'm sure there are exceptions (I bet the Instagram folks did just fine). But if I had to make a guess, it'd be that the founders will come out with a good chunk of cash, and employees will get a job at Chase out of it (with the valued employees getting a nice bonus at the "new car money" level)

[bogomipz]

>"It's also a very real possibility that the "real" cost that Chase paid was just the right amount to make the common stock evaporate; investors get their money back such that $0 is split amongst common stock."

Would you mind elaborating on this? What causes the common stock to "evaporate" exactly? Is this a side effect or is this intentional?

>"Employees then are given a sheet to sign saying that their stock in WePay is now worth $0, but here's an offer for Chase stock vesting over 4 years."

For an the average rank and file employee who has been grinding it out at Wepay through the ups and downs I am imagining this might not be a "feel good" moment.

[JonFish85]

> "What causes the common stock to "evaporate" exactly? Is this a side effect or is this intentional?"

This would mean something like paying exactly what the valuation at the last round was, such that it'd cause the cap table to unwind leaving precisely $0 to split amongst common stock. It's not a huge win for investors, but if it's clearly not going to be a huge win, they get their money back (plus whatever conditions they had for more), and can move on.

> "For an the average rank and file employee who has been grinding it out at Wepay through the ups and downs I am imagining this might not be a "feel good" moment."

Probably not. I've had friends who have been at companies that have sold at these "big numbers", but come to the sad realization that the numbers aren't "real" (e.g. their 1.5% stake of $250m is worth $0). I'm sure it's a weird feeling to see the "congrats!" messages! However, the "retention bonus" of $100k over 4 years on top of their salary is usually enough to keep people from burning the place down (being facetious).

[bogomipz]

Thanks for the clarification. I do feel for the employees that are realizing their equity they took in lieu of cash is worthless.

The retention bonus is nice provided you don't mind working for a Goliath bank I guess.