Lead Quote in SF Chronicle Story on Stock Options

As frequent readers will know, I have been working in and around Silicon Valley for the past 20+ years and, despite recent abuses, I remain a true believer in stock options both as a way of aligning employee and owner interests and as a way of enabling the Horatio Alger part of the American Dream.

So I’m happy to report that San Francisco Chronicle writer Jessica Guynn recently found this post, entitled “Stock Options, It’s a Darned Shame” and wanted to have a chat about it. This chat resulted in the lead quote in this story in yesterday’s San Francisco Chronicle.

I’ll pull the lead few paragraphs here:

From the time he joined his first startup two decades ago, David Kellogg felt the powerful pull of Silicon Valley, a magical place where workers funnel all their energy into helping their companies succeed in hopes of netting a lottery-like payout.

Kellogg worked for a series of successful privately held companies and received stock options at each one. Along with some extra money from the options when the companies went public, he took home a sense of their larger purpose.

“Options let me participate in the value I was creating,” said Kellogg, 44, chief executive officer of San Mateo softwaremaker Mark Logic Corp.

That’s why Kellogg says it’s a shame stock options are falling into such disfavor.

The rest of the story is here.

While I believe that stock options are lottery-like in the context of a single company, I believe that the lottery / chance aspect of them is lessened over the course of a career. As I used to tell my friends, and myself at points in the past when patience would wane: by working in software in Silicon Valley you are standing in a field in a thunderstorm holding a lightning rod. That others get hit before you is not negative, but positive. The storm is still on.

Simply put, if you have a big equity hit at your first job, then congratulations because you are probably both smart and lucky. If you don’t, keep working your way up the hierarchy (equity tends to increase faster than salary with seniority) and keep holding your lightning rod. If you’re enjoying the work you do along the way, then you will have a fun career, and in all likelihood, one day your lightning rod will be hit.

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