Bill, Elon, Mark, Jeff, Steve. These people are so famous that I don’t even need to tell you their second names, you already know who all these people are (Okay I admit it would’ve been harder without Elon in there). They are all celebrated for the companies they built, and rightly so.
What’s never talked about is the people behind those people. For every one Mark Zuckerberg, there are thousands of people who joined and worked at Facebook as it grew, watched their equity in the company go up in value and had a great outcome.
That’s what RSU Club is about.
We find great startups which offer stock as well as salary to their employees, and we try to highlight the startups where the stock you receive has the chance of going up substantially in value.
Some Example Numbers – The Success Case
For a junior or mid-level employee, it is common for a share options package to include $100,000-$200,000 worth of stock, over four years. So that means each year you work at the company, as well as your salary you earn $25-50,000 worth of stock. Bear in mind, if you are a senior engineer or something like that, you can expect a lot more than this. But this is typical even at a more junior level.
Now imagine you joined a startup and when you joined, the valuation of the company was $500 million. A $500 million valuation means it’s a fairly big company. It’s not a one-person business that just started three months ago, where there is a lot of risk that you might lose your job next week. Now let’s say you stay there four years and earn $100,000 worth of stock over these years. But during this time, the overall company has done really well, grown revenue and expanded market share. Instead of being valued at $500 million like before, the company is now valued at $5 billion. That $100,000 you earned in stock is now worth a million dollars!
You’ve become a self-made millionaire, while not taking any massive financial or career risk. You haven’t had to put your life savings and bet them on crypto. You haven’t had to take on investment and debt to launch your own business. You’ve made a life-changing sum of money just by working a normal job at an exceptional company.
Sound too good to be true? It’s a story that’s played out many, many times over.
Noah Kagan's Story
Noah Kagan is now the founder of Appsumo. But when he was 24, he was hired as employee #30 at Facebook. As part of his compensation, he was due to receive 0.1% of the company. He had to work at Facebook for one year before he unlocked his first tranche of shares. Nine months in, however, Noah got drunk at a party and told a reporter about a new feature Facebook was launching. Mark Zuckerberg found out Noah had leaked information he wasn't supposed to, and Noah got fired. If Noah held on for three more months, the equity he would've earned from that year of work alone would now be worth of $100 million. If he stayed at Facebook for a number of years and earned out his whole 0.1% of the company, that would be worth $1 billion now.
Things still worked out, because Appsumo now makes hundreds of millions a year in revenue. But there are two lessons we can take away from Noah's story:
1) There is a lot of money to be made and growth to be experienced by just joining a rocket ship.
2) Snitches get stitches (just kidding).
If you're interested, he made a full video outlining his lessons from the experience here.
The Case of Stripe
In 2012, Stripe raised a new funding round and the company was valued at $500 million. Stripe was already a success, and if you knew anything about the company, you knew they were solving a really important problem. They were finally giving developers an easy way to build payment infrastructure on the Internet. Over the next ten years, Stripe's valuation reached almost $100 billion. If you had worked there and earned stock (which they were offering to employees), your stock would have gone up 200x. Even $10,000 of stock earned as a junior employee would be worth $2 million all those years later.
In 2018, a backend engineer at Stripe reported receiving stock worth $225,000, having joined two years before. If they earned that amount of stock each year, they would be sitting on stock worth $4.9 million right now.
The Case of Nvidia
Nvidia is now the most valuable company in the world. Nvidia makes microchips, and as AI began to take off, AI companies realised that there was in fact a massive shortage of these microchips. Over the past few years, the valuation of Nvidia has gone up over 100x. That means that there are mid-level employees at Nvidia, who have been there a while, watched their stock options go up and up, and are now worth over 10 million dollars.
Less Extreme Cases
These are outlier cases of companies that became massive. But there are also countless examples of companies which were already big ($500m to $1 billion valuation) but still managed to get 5-10x bigger over the years as they grew. Employees at these companies didn’t make tens of millions like Nvidia employees have done, but they still did very well. And again, it’s important to remember, that they did very well while working normal jobs.
The Failure Case
Now of course, it’s hard to predict things like this beforehand, and you may end up at a company which doesn’t grow as much as you expected. In this case, you’ve still gained experience in a role and earned a good salary for a few years. You’re not facing bankruptcy because you’ve not lost any initial investment. At this point you can use your experiencing to get another, this time more senior, role at another promising company. Over the course of your career you get many rolls of the dice.
How risky do you want to be?
There’s a trade-off here. If you want stock in a company whose value might go up massively, you will usually have to target smaller, early-stage companies. And going to these usually involves more risky. But if you’re happy for a smaller gain, you could go to a massive company with hundreds or thousands of employees, that still has room to grow.
Weekly Reports & Deep Dives
This site specialises in two things: weekly reports and deep dives. The weekly report go over companies, which are already of a certain size, which have just raised a new round of funding, and are hiring and offering equity to their employees. By following these reports, you can find out about new opportunities, as soon as they become available.
The Deep dives go into more detail about specific companies that are poised to grow fast, which I think are worth highlighting.
About the Author
I’m Sunny, and I’ve been working in the tech industry for the past five years. I’ve worked at very early-stage startups, billion-dollar unicorn companies and everything in between. Throughout my journey I’ve encountered people who joined a promising startup at the right time, did a good job and reaped the rewards.
Often, when someone is looking for a new role, they’re in a rush. Maybe they’re about to graduate college or university and need a job ASAP. Maybe they don’t like their current job situation and really need a change. They don’t think too much about the companies they’re applying to. They spray out as many applications as they can and join whoever accepts them. Through my time working in the industry, I realised how important company choice was in the world of startups particularly. It can mean the difference between massive career growth and stagnation.
I created this site to help people make that choice.
The Way this Site works
I want you to think of this site like a Pinterest board. I find companies that give equity/stock options to their employees, I tell you about what they do, how they’ve been doing and give my take on their future prospects. But after that, it’s up to you to think about which companies would suit you best, where you could develop skills and where you think you will thrive.
I’m like the News. I report. But you have to decide.
I’m not saying you should immediately quit your job and work for one of these companies immediately.
I’m just saying you should start paying attention.
And that’s what I’m here to help you with.