Field Manager Pay Works Better In Cash Than Options
A yard supervisor handed me an option grant letter on a Tuesday morning and asked me what it was worth. He had four pages of vesting schedule, a strike price, and a written offer from a company forty miles down the road that paid $15,000 more in cash. I read the letter twice and could not give him a number. He was not being difficult. He was asking the only question about pay that a man in his position can afford to ask, which is what the package is worth to him this year, and I did not have an answer he could use. My name is Rosser Newton, I have spent more than 35 years investing in privately held energy companies and sitting at their board tables, and I have watched that letter lose that conversation more times than I care to count. Why Equity Does Not Work Below The Executive Line An option in a private company is a claim on an event nobody can schedule. There is no market for it, no quoted price, and no way for the holder to sell a slice of the grant to cover a truck payme...