Former Uber Employees Have Gone Into Debt To Hang Onto Shares They Can't Sell (qz.com)

← Back to Stories (view on slashdot.org)

Former Uber Employees Have Gone Into Debt To Hang Onto Shares They Can't Sell (qz.com)

Posted by BeauHD on Tuesday December 12, 2017 @10:40AM from the hang-in-there dept.

An anonymous reader quotes a report from Quartz: Uber employees are lining up to sell their stock to Japanese technology giant SoftBank, which will buy up to 17% of outstanding shares for $33 each. The price represents a 30% discount to Uber's last valuation, of nearly $70 billion, but for current and former employees, the SoftBank tender offer is a rare chance to convert paper wealth into actual cash. To qualify for the tender offer, participants must have at least 10,000 Uber shares and be "accredited investors," an SEC designation (pdf) for wealthy individuals. Current Uber employees can't sell more than half of their stake; there are no restrictions on former employees. The deal is on the table until Dec. 28, and could fall through if there aren't enough shares on offer for SoftBank and a small consortium of other investors to purchase at least a 14% stake in the company.

Working at a successful startup is often viewed as a quick path to prosperity, but the reality is more complicated. Startups tend to offer equity packages, typically in the form of stock options, to compensate for below-market salaries. But as companies like Uber have stayed private longer, most employees haven't been able to get rich from those shares. Quite the opposite, some former Uber employees have gone into debt to hang onto shares they still can't sell.

72 comments

Min score:

Reason:

Sort:

Paycheck by Anonymous Coward · 2017-12-12 10:47 · Score: 1

The devil pays in unredeemable stock options for a company in a perpetual state between collapse and a liquidity event.
1. Re:Paycheck by Mr+D+from+63 · 2017-12-12 10:50 · Score: 1
  
  Sometimes the decision to leave a company has consequences. Sometimes the decision to exercise options has consequences. One should think things through before making either decision.
2. Re:Paycheck by Anonymous Coward · 2017-12-12 10:55 · Score: 2, Insightful
  
  Well that's some completely fucking worthless advice. Here's my advice - don't ever assume that any stock options offered to you are ever going to be worth anything. Don't ever make financial decisions assuming that stock options will ever translate into actual stock.
3. Re:Paycheck by Anonymous Coward · 2017-12-12 13:30 · Score: 0
  
  Sometimes the decision to leave a company has consequences. Sometimes the decision to exercise options has consequences. One should think things through before making either decision.
  Sometimes employees believe the bullshit get-rich sell when accepting a below-market salary.
  Sometimes employees get fucked in the long run when the bullshit doesn't come to fruition.
  Somewhere buried in my paperwork I've got 10,000 shares of .bomb stocks more worthless than the paper they're printed on, so yeah, I speak from experience.
4. Re:Paycheck by HornWumpus · 2017-12-12 13:37 · Score: 1
  
  Right for private, 'pants on head' wrong for publicly traded.
  Also devil is in the details. How long to vest? How long to exercise after separation? 'No sell' windows? Right to sell option to 3rd party, unexercised etc etc.
  For startup, just ask for equity (less shares than options offered, no doubt) delivered on their proposed option vesting schedule. If they balk, they were planning on fucking you, not even kissing you when done. At least they expected their VCs to do a lot of employee option fucking over. It might make your tax life more complicated, but if it does, it was time anyhow. It's still 'worthless until not', but you limit their ability to screw you out of anything.
  At the very least get one share. So you are in the shareholder meetings, not outside. If you do end up with options, make sure you can exercise on a minimal number. Shareholder status matters a lot with privately held corps.
  
  --
  John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
5. Re:Paycheck by tippen · 2017-12-13 04:25 · Score: 1
  
  For startup, just ask for equity (less shares than options offered, no doubt) delivered on their proposed option vesting schedule.
  An equity grant like that results in the employee getting taxed when they receive the stock, which they may not be able to afford since they can't actually sell any of the stock to cover the taxes. It's exactly that tax problem that stock options are intended to help with. It let's you decide when to take the tax hit.
  The real problem is a combination of expiration dates on stock options (10 years typically) and late stage companies that don't want to face the discipline/regulations that come with being publicly traded. When they stay private for 10+ years, it puts early employees in a bind because they have to either exercise their options (and come up with $$ to cover the taxes on their gain) or lose them.
  Some companies are starting to go to longer expiration periods because of this. Founders don't want their employees getting pushed into a corner like that.
HANG ON TO YOUR LIFE! by Anonymous Coward · 2017-12-12 10:48 · Score: 0

Your life!
Your life!
Your li
Makes sense by rsilvergun · 2017-12-12 10:48 · Score: 1

If Uber was going to be killed off it'd happened by now. The amount of money that is on the table when you're talking about a company that has managed to legally side step minimum wage and other worker protection laws can't be understated. Uber has redefined the work dynamic anywhere it's been allowed. They got away with it because the law was turning a blind eye to Taxi cab driver's abuse. Assuming there isn't a massive sea change in pro worker regulations then in 10, 20 years everybody but Doctors and Lawyers (who have strong Unions to protect them) will be in the gig economy.

--
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
1. Re:Makes sense by b0s0z0ku · 2017-12-12 10:55 · Score: 1
  
  A strict money-for-work exchange for most employees would lead to a clamor for gov't to pick up things like health care. Which might be a good thing.
2. Re:Makes sense by Joe_Dragon · 2017-12-12 12:10 · Score: 1
  
  and doctotrs maybe forced to take the low Medicaid payouts and some may be willing to help push people on to SSDI so they can go to higher medicare payouts.
3. Re:Makes sense by Anonymous Coward · 2017-12-12 12:52 · Score: 0
  
  They got away with it because politicians enjoy using Uber.
4. Re:Makes sense by Holi · 2017-12-12 12:58 · Score: 1
  
  They got away with it because taxi drivers tend to be immigrants.
  
  --
  Sorry, teleporters just kill you and then make a copy. A perfect, soul-less copy.
5. Re:Makes sense by ShanghaiBill · 2017-12-12 15:14 · Score: 2
  
  If corporate sponsored health care disappeared, we would most likely move to a Canadian style single payer system, and Medicaid and Medicare would be absorbed into it.
  In Maoist China each factory ran a school for the children of their employees, so if you changed jobs, your kids had to switch to a different school. That is obviously an idiotic system, but getting your health care from you employer is just as idiotic, and you only think it makes sense because you are used to it.
6. Re:Makes sense by AvitarX · 2017-12-12 18:41 · Score: 1
  
  Or taxis suck in much of the country.
  There was no functional taxi service where I live except for special events and airport runs.
  With Uber and Lyft, short runs can be had in 5 minutes (I watched someone wait 3 hours for a taxi home from my shopping center, I called them a Lyft, 8 minutes).
  Even in NYC, getting a pickup at the edges of Bushwick was spotty, and at night, they try to make sure you're not leaving for Brooklyn when getting in.
  Maybe taxis do absolutely the most they can profitably (I know Uber and Lyft aren't sustainable at their current price and coverage), but in much of the country taxis we're an industry begging for disruption, just like everyone hated the record companies, we all hated taxis too.
  
  --
  Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
7. Re: Makes sense by Anonymous Coward · 2017-12-13 00:23 · Score: 0
  
  ...except my health care organization isnâ(TM)t run by my employer, as is the case in your school example.
  My employer provides my insurance, but I can pay for it myself, or get another job.
  Even I canâ(TM)t keep the same insurance I am likely to be able to keep the the same health care organization because most accept multiple insurance types. ...but I do get what youâ(TM)re sayingâ"weâ(TM)ve tied being provided affordable health care with having a job or money, something weâ(TM)ve managed to distance childhood education from (in a manner or sorts); It would be great if we could do that for health care too, though I wonder if that would accelerate Americaâ(TM)s slide into a gig economy? Medical insurance is probably a very large reason some people keep jobs they donâ(TM)t like.
8. Re:Makes sense by Anonymous Coward · 2017-12-13 03:45 · Score: 0
  
  Getting your healthcare from the government is *just* as idiotic. Governments (especially big ones like the US federal one) can *barely* govern effectively. Do you really want delegate your health care to the bunch of idiots working the swamp in Washington?
  Employer provided healthcare is a "perk". It would be better to end government regulation of this, and to insist that everyone get their own healthcare (excepting those too poor to do so -- if you are on food stamps you get some federal healthcare assistance I guess). A healthcare mandate, along with a tax deduction for the expenses, would leave the market open, and mostly keep the buffoons from dicking with it.
9. Re:Makes sense by flink · 2017-12-13 07:36 · Score: 1
  
  An individual government mandate without a government-managed exchange like we have now would leave everyone in a risk pool of 1 (or some other tiny number if buying a family plan). You would end up with the old and infirm (you know, the people who actually need insurance) completely priced out of the market.
  The only reason insurance is even vaguely attainable outside of employer or union negotiated contracts is because of the government operated exchanges creating larger risk pools for you to join.
10. Re: Makes sense by Brockmire · 2017-12-13 10:48 · Score: 1
  
  Doctors and lawyers have unions? What country are you from? I've never heard of this.
Yeah - you need to already be wealthy.... by Puls4r · 2017-12-12 10:54 · Score: 4, Insightful

To get your money. Nice trick huh?
1. Re:Yeah - you need to already be wealthy.... by b0s0z0ku · 2017-12-12 10:58 · Score: 2
  
  Yep, "accredited investor" translates as "little guys can't play" at least if they're under US law.
2. Re:Yeah - you need to already be wealthy.... by Anonymous Coward · 2017-12-12 11:19 · Score: 0
  
  To be fair, many of the things that require one to be an accredited investor are risky as all hell. So is Uber stock, honestly.
3. Re:Yeah - you need to already be wealthy.... by known_coward_69 · 2017-12-12 11:44 · Score: 1
  
  or you can simply wait until the IPO and then sell
4. Re:Yeah - you need to already be wealthy.... by Anonymous Coward · 2017-12-12 11:47 · Score: 1
  
  You don't think the day before the IPO, those options won't be cancelled, or shares split to the point of being worthless, or a new 100x voting class created just for the C-suite?
5. Re:Yeah - you need to already be wealthy.... by Anonymous Coward · 2017-12-12 12:04 · Score: 0
  
  Legalized slave labor in startups meets legalized gambling in stocks.
6. Re:Yeah - you need to already be wealthy.... by Enigma2175 · 2017-12-12 13:44 · Score: 0
  
  To be fair, many of the things that require one to be an accredited investor are risky as all hell. So is Uber stock, honestly.
  What the hell are you talking about? Risky as all hell? If you have an income over 200k for 2 years and expect to have that income going forward or if you have over $1 million in assets, you are an accredited investor. How is making a lot of money "risky as all hell"? You can also be an accredited investor if you are a broker, financial adviser or have a financial education. Like the parent said, "little guys can't play".
  
  --
  Enigma
7. Re:Yeah - you need to already be wealthy.... by Actually,+I+do+RTFA · 2017-12-12 19:03 · Score: 2
  
  What the hell are you talking about?
  
  You seem to have misread GP. He didn't say that it was risky to make a lot of money (that's a requirement of being an accredited investor). He said investments that require you to be an accredited investor are often risky. Which they are. Which makes sense, because the point behind the accredited investor rule is exactly to prevent people from gambling with money they cannot afford to lose.
  
  --
  Your ad here. Ask me how!
8. Re:Yeah - you need to already be wealthy.... by thesandtiger · 2017-12-13 12:17 · Score: 1
  
  If that were actually the intent, then lottery tickets and casinos would likewise require people to prove they can afford to lose that money.
  They don't, and this rule is just another way that the haves are trying to remove the ability of the have nots to better their lot in life. If one thinks otherwise, one hasn't been paying attention.
  
  --
  Since I can't tell them apart, I treat all ACs as the same person.
9. Re:Yeah - you need to already be wealthy.... by Actually,+I+do+RTFA · 2017-12-13 13:18 · Score: 1
  
  I actually think the lottery is a classic case of lawmarker's lack of imagination. It's probably hard for them to imagine a few dollars being something someone cannot afford to lose, or that people would do more than buy the occasional scratcher.
  Also, lotteries and casinos are clearly bad investments. A lot of the investments that require an accredited investor are much harder to value the risk on.
  Now, that said, I imagine the reason the law passed was a coalition of those points of view and other people who wanted to just screw have-nots. Which is why it passed. Those two coalitions are each like 45% of the government.
  
  --
  Your ad here. Ask me how!
Options can be a rip by HangingChad · 2017-12-12 10:55 · Score: 4, Insightful

The way options are taxed can make them kind of a bum deal. Depending on whether you're getting NSOs or ISOs, the price, and when you exercise your options can cost or save thousands.
Personally, I'd rather have a higher salary. Options are a nice bonus but, as in Uber's situation, they can also be a financial burden.

--
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
1. Re:Options can be a rip by Anonymous Coward · 2017-12-12 11:54 · Score: 1
  
  Us Joe averages get stars in our eyes when we hear "stock options" because we've all heard the stories about the janitor at Microsoft that took some stock options and ended up becoming a millionaire later on.
2. Re:Options can be a rip by Anonymous Coward · 2017-12-12 13:34 · Score: 0
  
  Yeah, I thought we learned this lesson in the early 00s? Fuck your options, give me the cash.
  Unless I'm already rich and I think this is a good gamble.
  But most people aren't already rich.
3. Re:Options can be a rip by Anonymous Coward · 2017-12-12 21:07 · Score: 0
  
  Personally, I'd rather have a higher salary. Options are a nice bonus but, as in Uber's situation, they can also be a financial burden.
  I agree completely. The tax implications can be quite complex and for every Facebook, Google or Microsoft back in the day there are tens of thousands of startups that you never heard off that went bust and left ex employees holding worthless options. I put options firmly in the bonus category, but even then rank them lower than a cash bonus. They are never a substitute for salary in my opinion and especially not after age 30.
4. Re:Options can be a rip by Afty0r · 2017-12-12 21:26 · Score: 1
  
  Why not just tax them when someone sells them? We have something called Capital Gains Tax in the UK - when you sell something you made a profit on, if that profit is above a small threshold, you have to pay a percentage of all the gains you made... if you didn't make a profit, no tax. This makes investment more attractive by removing some of the risk. In the USA do you have to pay tax on the estimated value of the shares every year or something?
5. Re:Options can be a rip by Anonymous Coward · 2017-12-12 22:34 · Score: 0
  
  Why not just tax them when someone sells them? We have something called Capital Gains Tax in the UK - when you sell something you made a profit on, if that profit is above a small threshold, you have to pay a percentage of all the gains you made... if you didn't make a profit, no tax. This makes investment more attractive by removing some of the risk.
  In the USA do you have to pay tax on the estimated value of the shares every year or something?
  Unfortunately it doesn't work like that in the UK either. If you have unapproved stock options, as most late joiners to a company will have, they are taxed as income when you buy them on the full price of the share you acquire.
6. Re:Options can be a rip by Anonymous Coward · 2017-12-13 06:12 · Score: 0
  
  Yep. They are a complete gamble, just like the stock market. The only difference is you get this engraved invitation for "options", making you think it is something special, and not just another losing lottery ticket. Agree totally, better to get the cash compensation or even extra vacation time is better IMO.
Scab livery drivers get by Anonymous Coward · 2017-12-12 10:58 · Score: 0

There's a reason for modern unions. Uber & slime-ball ilk are the reason. Now investors get a tiny taste of the shit sammittch. Munch-it-down broz ...
someone's pf ask by Anonymous Coward · 2017-12-12 11:08 · Score: 0

https://www.reddit.com/r/personalfinance/comments/7g1ebj/cash_out_or_let_it_ride/
Come join my statup by Anonymous Coward · 2017-12-12 11:15 · Score: 0

Please disregard this FUD piece, what nonsense... Oh and my angel investor funded stealth startup is hiring now! 70 hour work weeks till we get rolling but you will be well compensated with industry standard equity packages, stock options, 401K and of course free lunches.
1. Re:Come join my statup by ZipK · 2017-12-12 11:21 · Score: 1
  
  Do you have a slide?
2. Re:Come join my statup by bickerdyke · 2017-12-12 21:59 · Score: 1
  
  More important: a Foosball table
  Been in several non-startup but middle sized tech companies and ALL of them made a big point about having one. No one ever used them, but they had to have it, because that's what made Google so rich, wasn't it?
  
  --
  bickerdyke
3. Re:Come join my statup by Anonymous Coward · 2017-12-13 05:36 · Score: 0
  
  They'd do better with air hockey and billiards I dare say
please explain... by jm007 · 2017-12-12 11:18 · Score: 1

"employees have gone into debt to hang onto shares they still can't sell"

didn't read TFA so maybe it's in there.... but does this mean that they will lose their shares if the don't go into debt?
1. Re:please explain... by Anonymous Coward · 2017-12-12 11:33 · Score: 0
  
  Stock options typically have some sort of expiration clause (time since issue, termination of employment, possibly other events) by which time they must be exercised (purchased). It is very plausible that an employee might go into debt in order to exercise the option. If they fail to exercise the option before it expires, then they lose the option entirely.
  Private stock shares tend to be extremely non liquid - it can be very challenging to find a qualified buyer, so if you went into debt purchasing shares from your options you may have a hard time recouping that money.
2. Re:please explain... by AvitarX · 2017-12-12 11:39 · Score: 1
  
  They had to go into debt to turn their options into shares I assume.
  
  --
  Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
3. Re:please explain... by Baton+Rogue · 2017-12-12 11:52 · Score: 5, Informative
  
  When you get stock options, you get X shares at Y strike price, with Z vesting period.
  
  Lets say you get 10,000 shares, at a strike price of $10 a share, with a 4 year vesting period.
  
  Let's assume you worked there 4 years, so all of the shares are vested. If you want to "exercise" the shares, you have 2 options:
  1) Buy the options with cash ($10 per share x 10,000 shares = $100,000).
  2) If the company is publicly traded, you can also do a "same-day-sale". If the public price is higher than your strike price (lets say $20), you "buy" the shares at $10, then sell them on the open market at $20, and you pocket the difference, so you would make $100,000 (minus taxes).
  
  Once you leave a company, all un-exercised options are forfeited after a time (90 days for example). For a private stock, you cannot sell them on the open market, so you only have the first option to buy them with cash. You now own all of those shares, but you cannot sell them publicly, so you have to hold onto them hoping that the company goes IPO, or an investor wants to buy them, like SoftBank.
4. Re:please explain... by stabiesoft · 2017-12-12 12:37 · Score: 1
  
  Worse you may owe taxes if the option price is less than the current "market value" which is probably the price the last round paid.
5. Re:please explain... by they_call_me_quag · 2017-12-12 15:13 · Score: 1
  
  Lets say you get 10,000 shares, at a strike price of $10 a share, with a 4 year vesting period.
  Not likely. I've worked at six start-ups including one that went public and two that are moving in that direction. I was employee #80 at the one that went public, #666 at the next and #200ish at my current employer, so I speak from experience.
  A strike price of $10 is not a realistic example. My strike prices have all ranged from 1/10 of a penny to $1.25. My most recent pre-IPO stock grants have been in the neighborhood of one dollar. So let's change your example to:
  "Let's say you get 10,000 shares, at a strike price of $1.00"
  So the $10K in debt is not likely to break most tech employees. As noted by others, the real trick is to buy your stock in such a way that you avoid short-term capital gains and the dreaded AMT.
6. Re:please explain... by Anonymous Coward · 2017-12-13 00:40 · Score: 0
  
  What companies have you worked for? The only 3 I've worked for that had an IPO had a price of $15, $30, and $5. The 2nd two never actually went public, the one that gave me a $30/share price was purchased at $15/share as the company collapsed.
  My lesson? In a pre-IPO company, unless its obvious the company will disrupt and become the Next Big Thing, don't expect those 'options' to be an option.
7. Re:please explain... by Anonymous Coward · 2017-12-13 02:53 · Score: 0
  
  Well if you RTFA, there are two examples of former Uber employees who needed to shell out $200K+ to exercise and pay taxes on their options. So you can see why they went into debt.
8. Re:please explain... by Anonymous Coward · 2017-12-13 05:04 · Score: 0
  
  2) If the company is publicly traded, you can also do a "same-day-sale". If the public price is higher than your strike price (lets say $20), you "buy" the shares at $10, then sell them on the open market at $20, and you pocket the difference, so you would make $100,000 (minus taxes).
  You've got that backward. You short sell the shares, then buy them back with the options. No up front cash needed.
They Get What They Deserve by NicknameUnavailable · 2017-12-12 11:24 · Score: 0

Uber employees have worked for years to knowingly skirt laws around the world, create algorithms to take advantage of drivers and riders alike, and ultimately with the goal of replacing entire industries so their masters can make billions while they skim a little off for their "work." It's a story literally as old as the start of recorded history: peon sellouts work for non-peon sellouts and get screwed over by their masters after breaking themselves thinking they can get a little bit of that sweet corruption with only moderate moral guilt. Fuck them all, I have no pity to spare.
1. Re:They Get What They Deserve by Anonymous Coward · 2017-12-12 11:38 · Score: 0
  
  Uber employees have worked for years to knowingly skirt laws around the world, create algorithms to take advantage of drivers and riders alike, and ultimately with the goal of replacing entire industries so their masters can make billions while they skim a little off for their "work."
  Best definition of "efficiency" I've seen.
2. Re:They Get What They Deserve by barc0001 · 2017-12-12 11:44 · Score: 3, Informative
  
  > create algorithms to take advantage of drivers and riders alike
  If you think Uber was taking advantage of riders, you've never used the cab companies in Vancouver. Based on my usage of Uber in other cities (Vancouver has yet to get with the 21st century), I'd be happy to let them think they're screwing me as they'd still be half the price of a cab here AND faster.
3. Re:They Get What They Deserve by Holi · 2017-12-12 13:04 · Score: 1
  
  Since when do cab companies set their own rates? pretty sure (at least here in the States) there is a government commission which set's taxi rates, which is why taxi rates are the same between the different companies. Which is one of those pesky laws Uber violates.
  
  --
  Sorry, teleporters just kill you and then make a copy. A perfect, soul-less copy.
4. Re:They Get What They Deserve by NicknameUnavailable · 2017-12-12 15:23 · Score: 0
  
  There are over 5 million auto accidents a year. If Uber succeeds in automating vehicles they could theoretically get the number down near zero, but they won't. They'll get the number down to around 20%, be heros for it, and the government will be able to off 1 million political dissidents a year without anyone batting an eye. Driverless cars and by extension Uber (since their entire business model is built around buying time until they can replace their fleet with driverless cars) are corrupt by nature.
5. Re:They Get What They Deserve by NicknameUnavailable · 2017-12-12 15:24 · Score: 1
  
  Pretty much, Silicon Valley has a habit of ignoring every law and thinking "it's OK, we work in tech," a bunch of corrupt marketing people, the entire area.
6. Re:They Get What They Deserve by barc0001 · 2017-12-12 16:44 · Score: 2
  
  > the government will be able to off 1 million political dissidents a year without anyone batting an eye. Driverless cars and by extension Uber (since their entire business model is built around buying time until they can replace their fleet with driverless cars) are corrupt by nature.
  Whoa there... now we're veering way into tinfoil hat territory.
  So to paraphrase your position it's that Uber will be used to kill enemies of the government? Do you not see how most people might think that's a bit of a crazy thing to say?
7. Re:They Get What They Deserve by NicknameUnavailable · 2017-12-13 08:47 · Score: 1
  
  Whoa there... now we're veering way into tinfoil hat territory.
  How is that even remotely tinfoil hat territory? The only things Silicon Valley has done over the years are automate jobs, consolidate power, spy on people for the government (under the guise of marketing mostly, though Google, Facebook, Amazon, Intel, etc and all the other major ones actively collaborate with the government and have specific publicly-known projects for doing so without the bounds of their specialization) and every single government in Human history given the blanket ability to do a thing has done so regardless of morality when it suited them. Uber has been allowed to skirt taxi regulations around the world almost unhindered (certainly the case for the US,) where the average person can't so much as miss a year worth of taxes without going to jail and having all their possessions seized. To suggest Uber has no intention of collaborating (assuming they aren't already merely on data sharing, which is quite the assumption to make) is downright absurd. When it comes the conspiracies involving large corporations and the government the burned of proof is on the one trying to disprove them, as that is the far more outlandish position given every single publicly known interaction.
Tasty Kool-aid by Ex-MislTech · 2017-12-12 11:26 · Score: 0

That uber kool-aid tastes so good, just can't stop drinking it.
reminds me of some of the wall street boondoogles, and the F-35 one.
$2 trillion for a plane that doesn't work right, and is outperformed by older models.

--
google "32 trillion offshore needs IRS attention"
To be clear, this isn't hurting the little guy by rmdingler · 2017-12-12 11:30 · Score: 1

FTS:

Quite the opposite, some former Uber employees have gone into debt to hang onto shares they still can't sell.
FTA:

Under current tax law, the income from exercising ISOs, a special type of option typically reserved for executives and senior employees, falls under an alternative tax calculation designed to prevent high-earners from using deductions to avoid paying tax. Non-qualified stock options, more commonly awarded to regular employees, are taxed the year they’re exercised on the gain in the stock.
It seems likely the people holding at least 10,000 shares are former executives who chose to exercise their stock options within the 30 days allowed by Uber upon deciding to terminate (or being terminated from) their employment.
Stock options are a way to reward executives financially outside of their normal pay structure. Exercising the afforded option(s) is typically only done when there's been a rise in the stock price during the option period.
TLDR: Nobody forces you to exercise the option on some stock you cannot sell. It's a gamble, like the majority of the investment in the market.

--
Happiness in intelligent people is the rarest thing I know.
Ernest Hemingway
1. Re:To be clear, this isn't hurting the little guy by Anonymous Coward · 2017-12-12 11:45 · Score: 1
  
  Nobody forces you to exercise the option on some stock you cannot sell.
  in your made-up fantasy world where there are no external forces and no other factors
  keep going, you've almost achieved your goal of complete lunacy
2. Re:To be clear, this isn't hurting the little guy by Baton+Rogue · 2017-12-12 12:00 · Score: 1
  
  It seems likely the people holding at least 10,000 shares are former executives who chose to exercise their stock options within the 30 days allowed by Uber
  
  Probably not. In the very early days of a startup, it is quite common for the first developers to get thousands of shares, at a very low strike price. I have heard of regular developers at my company that have hundreds of thousands of shares, at a sub-dollar strike price. Those people are given a very attractive stock offering because they are taking a large risk that they might lose their job if the company folds, so the company rewards them with more options. After a company has been in business, and proven to be successful, then the number of shares offered starts to drop off significantly.
Reminds me of that Simpsons episode by tylersoze · 2017-12-12 11:31 · Score: 1

Where the stock options for the startup are printed on toilet paper rolls.
change same to same by Anonymous Coward · 2017-12-12 11:38 · Score: 0

...offer is a rare chance to convert paper wealth into actual cash.
Sooo... they are turning paper wealth into paper wealth?
1. Re:change same to same by Per+Wigren · 2017-12-12 20:01 · Score: 1
  
  Paper cash is at least liquid.
  
  --
  My other account has a 3-digit UID.
Priority by Anonymous Coward · 2017-12-12 12:29 · Score: 0

Perhaps prioritize payment to those who purchased shares before its status as a shithole became widely known (and broadly assumed to be accurate).
forced hodl by Anonymous Coward · 2017-12-12 13:22 · Score: 0

forced hodl
I would never accept those terms by FudRucker · 2017-12-12 14:37 · Score: 1

if an employer offered my stock in the complany instead of a full cashable paycheck i would refuse even walk off the job, i cant pay bills or buy gas or groceries with stock investments, i will remember this bit of bad press and take it to heart in case any skinflint corporate pirate offered me stock instead of a full cashable pay check

--
Politics is Treachery, Religion is Brainwashing
So the visionary Taxi replacement by Anonymous Coward · 2017-12-12 14:49 · Score: 0

is like the visionary Currency replacement.
On paper, employees are wealthy. Too bad the rent is due at the end of the month.
Not one post has described this correclty by edtice1559 · 2017-12-13 01:51 · Score: 4, Informative

The issue is not with strike prices and taxes. It's that options have an expiration date. As an example, I was granted some options in 2007 at a (now publicly traded) company. They had a four year vesting period that ended in 2011 and a ten year expiration. So in October of 2020 (I don't know why it's not 2021), I can either (a) buy the options for cash and incur a tax event of (b) let them expire and lose all the value. Since our company is publicly traded, when I buy the options and pay cash + incur taxes, I can sell some of them to soften the blow. In fact, for publicly traded companies, any broker will arrange an "exercise and sell to cover" which basically mean you exercise the shares and then sell just enough to cover the strike price. At tax time, if needed, I could sell more. But if your company is still private when the expiration date comes up, you have to buy the shares and incur the taxes but you have no way to generate cash from the shares to cover those costs. That forces people to either lose value or take on debt to hold shares in a private company.
"Debt" Maybe Isn't the Right Word by QlooQl · 2017-12-14 05:21 · Score: 1

It's sad no one can buy employees shares yet, since Uber doesn't report to the SEC. The thing this tender offer does is allow smaller, poorer holders a price base to negotiate a loan from the bank. The loan is backed by the asset - the shares. It is a weird way to think about debt if you aren't an accounting or finance professional.
Quick loan by Anonymous Coward · 2017-12-14 05:36 · Score: 0

Whenever you or your loved once need a loan urgently for investment, to buy a property, to pay off bills or for any purpose, contact JAMES PETERSON WORLD LOANS SERVICES today as it is the best, tested and trusted. Beware of rippers online. Contact email: petersonworldloans@outlook.com for your quick and affordable loans. I got my loan from the reliable loan company.
This message might be of help to you out there in need of a genuine loan in other for you not to fall into the wrong hands in search of a liable loan, my advice to you is to contact this company via email: petersonworldloans@outlook.com.
thanks and God bless you
Rosita Kugere, Usa