:: You May Kiss the Bride :: Money ::

So you merge, or get acquired. But this time it's not with an AOL type of company, its more like an IOL type. Now people ask: "What happens to my Options?"

Ah. Those are gone.

And then they say: "But THEY told us differently?" Well, they lied. They also lied with the Billion Dollar company thing, but you know that already.

The thing is that mergers of the type we see these days are the classic case of business consolidation. It is not the type of merger that is to create synergetic value. It is the type that will cut costs and will keep whatever little value there is. And when this happens, none of the merged companies is going to be able to justify the valuation it presented to investors in the past when the company was supposed to be a fast growing independent entity.

The two merged entities will usually create one entity into which an additional investment will be made. All past investors will be compensated for the dilution in their share. This compensation will severely dilute both founders and employees. In cases where the value of the merged company is close to the amount of cash already invested, nothing at all will be left for both founders and employees.

Options were supposed to be the bribe for the employee. As it turns, kissing the bride is also kissing the bribe goodbye. But hell, these days, just having a salary based on numbers from the old and happy days is something one can't afford to lose.

At least not until the next round of layoffs.

Wadi Writer #1 (Gray)
WadiList@mail.com

Related Wadi Issues:
:: Kiss the Bride :: People :: http://www.oocities.org/wadilist/0183.htm