That hasn't been my experience. I've never had the experience of BigCo only acquiring just enough for 50.1% ownership. There's also clauses in the equity plans for participation on change of control (assuming that BigCo taking 50.1% constitutes change of control)
True that stock _options_ are only worth something after an IPO, but vested and exercised stock options that get turned into equity is a different story.
Equity can be worth something via acquisition from private equity doing roll-ups, corporate buyers looking to fill strategic product niches, etc
Also, for the more heavily vc-funded late stage still pre-ipo plays, secondary market, which can be at a discount to the most recent vc round, or in some rare instances in a hot sector, premium.
One other thing - waiting for the IPO might be the worst thing to wait to do. The public markets are much more fickle than private markets. Once a company IPOs, there's usually a trading moratorium on insider shares, usually 180 days, so by then, the equity value may have completely imploded.
holy crap the backstory on amazon fresh. no wonder. meanwhile I thought they'd solved that through tagging or something.
I guess I should've known - I had read the articles on how scale ai had a ton of folks in the philippines...
More importantly - the US bond market Treasury yields, the trigger that caused Trump to finally 180, has now continued rising (i.e. a very bad thing).
https://www.cnbc.com/bonds/
I recruited for a late stage pre-ipo unicorn after COVID. On the cash portion of compensation - 145k was the suggested starting negotiation point for a fresh out of college engineering candidate at offer stage. For that level, we'd go as high as a one-time additional 22k on signing with equity at 225k in RSU's (/4 year vest).
Or, this the beginnings of a sell-off as the rest of the world realizes that the US is no longer a reliable (trading/military/alliance) partner, and will move to mitigate the dependency for the rest of the world's mutual preservation.
Also - this implosion is happening WAY faster than the dotcom bubble pop and even 2020 COVID lockdown selloff, and there is no stimulus coming to save the market this time.
This was somewhat predictable, as Trump doing illogical Trumpian things, but somehow he even exceeded the maximum irrationality predicted by the market, thus, the heightened adverse reaction.
All of the major Wall Street banks called in their staff over the weekend. Lots of margin calls going out due to the market losses so far. Monday will be another bloodletting day, so there will be a chance that some customers may go unrecoverable net negative. This raises the issue of counterparty risk, and everyone tightens up as a result. Capitalization then becomes key, and with losses flying around, the first one to breach will end up cascading the risk to others. 2008 all over again, and oh yeah, weren't there mass layoffs on the government regulators side a few months ago - so who's answering the phone or running due diligence on the government side to figure out who is salvagable and who isn't?
No - it's based on hype and dreams. If it was solely based on fundamentals TSLA would carry an car company multiple, dropping a digit off it's share price. At that price, Elon would have a significant chunk of his TSLA holdings margin called away and be less of a threat to the world and the people on it as a whole.
calls for 3 months out only make sense once the stock price is decimated, and there's no certainty that prices will recover given the bumbling antics of this administration.
He had a sizable chunk of collateralized borrowings against his Tesla shares even before the Twitter acquisition. There was the risk of a margin call during year following the acquisition, but AI became the latest hotness so he was able to spin up a company to cook up some more market bubble.
Deficit under administration of: Republicans: Trump: +7.1T HW Bush: +2.2T W Bush: +2.1T Reagan: +1.7T Ford: +781.2B Hoover: +246.4B Nixon: +7.2B
Democrats: Obama: +5.6T Biden: +2.8T FDR: +1.3T Clinton: +614.4B JFK +194.8B Wilson: +191.9B
The rest of the presidents (D/R) - had net reductions in deficit.