Hacker News new | ask | show | jobs
by ptero 712 days ago
Of course, but a small portion of the employees, disproportionately concentrated at startups, are willing to take a bet on an eventual exit. They accept a 90+% chance of a company going belly up and a 7-digit payday if it becomes a roaring success.

But without an IPO it becomes a chance for a small royalty payment, and this is a lot less attractive success.
1 comments
toomuchtodo 712 days ago
I agree, these folks will have to make do without these previous opportunities existing or exit the industry if that is not palatable. Lottery tickets drying up.
link
ptero 711 days ago
But what is the reason for no longer selling those lottery tickets? Some employees really want them and they are a very good deal for the employers -- cash strapped early startups. What drives the drying up?
link
toomuchtodo 711 days ago
Interest rates rising providing a risk free rate substantially higher than the last decade, making it less necessary for investors reaching for yield to get VC asset class exposure. No VC funding, no startups issuing lottery equity tickets.

The situation will improve as the Fed cuts rates, but zero interest rate policy that fueled the previous economic exuberance is unlikely to return due to structural economic changes.

https://fred.stlouisfed.org/series/FEDFUNDS

https://www.goingvc.com/post/how-rising-interest-rates-impac...

https://www.wsj.com/finance/investing/high-interest-rates-cr... | https://archive.today/DPlzm

link