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Hipmunk (YC S10) Acquired by Concur (techcrunch.com)
196 points by jasonwilk on Sept 13, 2016 | hide | past | favorite | 116 comments



Hipmunk has been an excellent flight search tool, the best I have found as of a few years ago. Shockingly better than most of the rest of them back when it started, in terms of being able to understand and choose among numerous choices.

Unfortunately, that was then and this is now. Several of the airlines have dropped out of participating in flight comparison sites, and those that do apparently pay staggeringly little per referral. This is greatly eroded the usefulness of Hipmunk and similar sites, and taken away the motivation for anyone to pressure airlines to participate. Why bother when the most you can win is a tiny sliver?

I wish there is a way to simply pay a little money to get a comprehensive high quality comparison of all available flights from all airlines. I don't want AI, I don't want a travel agent to do it for me. I most definitely don't want to visit multiple airline websites and try to manually compare the offerings. I just want to see all of the different ways to get from point A to point B, in a well engineered graphical representation, all at once so I can quickly and effectively choose the best fit. I would love if there was a way to simply pay some dollars to do so.


If you have a Bloomberg terminal, there's a function like this that's been around for decades. If I remember correctly (I haven't had access to one since 2007) it might have been FLTS<go> or maybe just FLY<go>.

You plug in your cities and dates, and you get an 80x25 screen with the raw data in an easy-to-read (once you're used to it) tabular view.

Of course, that only works if by "some dollars" you meant like $25,000/year. :)


Adding this to my private list of reasons whenever someone scoffs at "paying $25k a year for a pair of LCDs and a cheap keyboard". Thanks.


Yeah you can be on the phone with the company travel department telling you the United flight at 10:13 doesn't fly between Dulles and New York on Tuesdays, and quickly type FLY IAD NYC<go> and you'll see a line like

    12.    UA 456  10:13 IAD  11:35 LGA   vvvv vv
(Where the v's are checkmarks in day-of-week columns; so you know it flies every day but Thurs)

Then you type 12<go> and get all the details. It all happened as fast as you could type plus about 10msec plus the speed of light roundtrip to lower Manhattan. And in the nine years since I used it, I bet they added other points of presence on other continents.


You can get the same info by typing "flight schedule iad nyc" into Google. It gives you a box that shows all flight numbers, takeoff and landing times, airport codes, and which days of the week they fly. (You might need to disable adblock though.)


I just tried that and indeed had to disable uBlock for it to show up.

I wonder how many other Google features I have been missing out on due to adblock being turned on...

Edit: turning off 'cosmetic filtering' on uBlock put it back again.


This list of Google SERP features is pretty impressive: http://www.link-assistant.com/news/serp-guide.html Though it's still missing tons of stuff like finance, calculator, flight status, etc.


Curious if anyone knows: is the Bloomberg terminal interfacing directly with one of the major CRS systems like Amadeus?


You pay with your money, right?


I don't understand the question. Yeah, you (royal "you") pay with money. I don't pay for it, since I wouldn't get the value out of it.


We clearly don't understand each other. You say "Adding this to my private list of reasons whenever someone scoffs at "paying $25k a year for a pair of LCDs and a cheap keyboard". I think, "his work is paying the 25k."

I don't scoff. But I can't afford it. By the way, the guy who said Google "flight schedule LAX ORD" did a great service here.


Oh, gotcha. I wasn't really talking about the who, but rather if a Bloomberg terminal is worth the cost. From time to time there are people who are just baffled why "a pair of LCDs and a keyboard" cost $2k each month. The answer being that the service is the thing being bought, and that it's clearly worth it to the people and companies that subscribe.


Is there any way to get access to that info without paying? It's okay if it's illegal, I don't mind.


Sure, absolutely. Just get a job at Bloomberg or any of its clients.

Alternately, visit your local university business school library.


Disclaimer: I work at flightfox.com.

What I think you’re asking for already exists. You didn’t mention price, which makes a big difference, but price aside, route data is available in both raw and GUI form. Check out flightconnections.com for a GUI tool.

Price is what consumers care about and without a perfectly efficient (or regulated or monopolized) market, there will never be a single source of all prices for all routes. This doesn’t exist for food, clothing or many genuine commodities.

Someone else replied with a link to ITAs white-paper that discusses the difficulty of the problem you’ve described. But, that only considers cash flights; what about fast trains, frequent flier miles, buying and using points, credit card bonuses, best rate guarantees, combining low cost-carriers, charter airlines, cargo flights, consolidator deals, local deals, company benefits, etc.

It’s a huge market that feels like it should be commoditized but is actually quite differentiated with significant barriers to entry.

My personal experience at Flightfox is overseeing the booking of travel for more than 60,000 people using travel websites rather than traditional GDSs (Global Distribution Systems - what travel agencies and online travel agents use). Our team has used most of the websites mentioned here and never relies on just one.

Most coders here could build a simple tool to make their searches much more effective and efficient:

  * Accept date/route/class input, like “10SEP DEN-FRA first”
  * Open tabs to 5-10 of the best and most varied travel websites
  * Skim the results and book
Doing this rather than sticking to a single site will yield much better results and make your search more efficient. The largest OTAs have real proprietary deals, the best of the aggregators search the best search engines, and the best search engines combine the most airlines (even LCCs) in creative ways.

If I had to choose 5 flight websites for such a tool: Kayak, Google, Orbitz, Skyscanner and Momondo.

Given this, you may wonder what’s the point of Flightfox. We started with a pure focus on travel hacks (much more advanced than searching 5 OTAs), but we now do our best work managing travel for businesses. For consumers, we can only use one skill: saving money. For businesses, we can become their entire travel department and put everything we know into practice. Not just saving many $1000s/month, but helping with finance strategy, loyalty programs, upgrades, 24/7 emergency support, super-cheap business/first, etc.


For why this is not possible even in principle, have a look at https://static.googleusercontent.com/media/www.itasoftware.c... (a really fascinating doc)


I too was a huge fan of Hipmunk, but have found that it's frustratingly difficult (anywhere) to get an "all-in" price, and last time I used Hipmunk I was really wishing they'd do it.

It's a difficult problem, for sure, but I'd like to be able to specify, for example, 1 checked bag, minimum 33" legroom, and then have the prices include checked baggage and any seat upgrade costs (if necessary, based on the airline's plane configuration).

The 'sort by agony' thing is great, but after getting stuck in a tiny seat sometime last year, I now pay close attention to seat size/pitch (I'm 6'0", my knees were on the back of the seat in front of me if I sat as far back in my seat as I could). I would have definitely loved to have Hipmunk rank 'agony' high on that one.


Google flights is pretty good, I think.

https://www.google.com/flights/

Skyscanner sometimes

https://www.skyscanner.net/


I really enjoy using Hipmunk too.

More recently, I've begun using Google Flights in more of an "explorer" capacity. Enter my starting city and travel dates. Then I use their map to see how much it is to fly to different places in the world. Perfect when I don't have a plan

https://www.google.com/flights/


My go to for not having a plan is Kayak Explore: https://www.kayak.com/explore


Have you tried flights.google.com?


Flights.google appears to have the same problem as the rest:

* Awful, text list of flights. I want a way to visualize the options, to wisely choose from many options.

* Subset of the airlines. Google still has Delta at least, which has disappeared from Hipmunk and some others. But no Southwest.


I thought their map / explore view was pretty good, actually [0]

Also I really like the flexible dates view [1]

Shame about Southwest for sure, but I think that's more on Southwest than anyone else (do they list their flights on any aggregator? I remember hearing somewhere that's part of their shtick is that they don't)

[0] http://imgur.com/GqRVfUG [1] http://imgur.com/Npnu7uU


Southwest doesn't share their data.


Ryanair doesn't share their data neither but I guess some websites (Kayak) scrap it.


I never bother with anything but Google Flights and it listed Ryanair last time I checked two weeks ago.


I'd also like more information about the flight: quality, seat comfort, meal included (or pay for on the flight), meal rating, flight entertainment (in seat, group, none), cleanliness, etc.

I'd be willing to pay a little more, if the flight wasn't like being in a metal torture container or the cleanliness levels were so poor that I get to my destination with an immediate illness. But right now I can only see that some flights are more expensive than others and no idea why. And I have to go off of my average experience with an airline to guess if the flight will be pleasant or miserable (except for United domestic, that's always miserable).


This won't be possible until we update our obsolete network access laws, which make it illegal to discover facts about airline routes and rates without the consent of the airline itself.


Note that they may not even be a "rate" to disclose in that the airline may be inventing ticket prices using algorithms in real-time. In that case to build a ticket search engine you need to either reproduce those algorithms or have the airline perform part of your search.


Even in 2010 when they started, air bookings didn't have enough margin to pay a decent commission. Flights gets people in the door, but you need to sell them a hotel to make money.


There's plenty of money being made in flights but it requires serious volume. Hipmunk were never able to take enough traffic away from kayak, skyscanner etc. as their only real differentiation (agony search) wasn't a big enough pull (other than for a sub section of business flyers who didn't have a travel implant to outsource the leg work to).

They also didn't put any serious energy in to markets outside the US (much less brand awareness in Europe) and were late to monetise supplementary channels like hotels and car hire.

Regardless, it's true that flight search is a tough game. Big incumbents, tight margins, crazy web of legacy madness behind the scenes (tech and business side).


> their only real differentiation (agony search)

Um, ground-breaking search visualisation UI? Or am I missing something?


I never became a fan of Hipmuk but may check them out again.

I use:

1. Expedia. Recently had a problem that they never issued me an eticket. Had to confirm with the airline directly that I actually have a ticket!

2. Vayama. Really like them. Good tool. Can be time consuming to change a ticket.

3.Book directly at airline. God idea, especially considering the problems laid out at #2. Not. Never book a ticket in a 3rd world country directly at the airline. I learned it the hard way!

4. Dohop. Quite unknown but I really like it. Use it a lot recently.

5. Swoodoo for the EU

And yeah, googles ITA.


> 3.Book directly at airline. God idea, especially considering the problems laid out at #2. Not. Never book a ticket in a 3rd world country directly at the airline. I learned it the hard way!

Unless it's a global airline (British Airways, Air France, KLM, Emirates, etc.) always book with an airline in your native country via codeshare. At least that way, you have some recourse via normal consumer protection measures in the event things go wrong.


What is the best flight search these days?


Disclaimer: I work at Kiwi.com.

At https://kiwi.com we combine flights ourselves instead of just taking the combinations from the big guys, you should try it out with a few queries. Not being limited to airline agreements when connecting flights can really drive the price down or make obscure routes viable.


Who protects the consumer when weather or FAA traffic management makes you miss your connecting flight?


Glad you asked. We do: https://www.kiwi.com/us/content/guarantee

Apparently the rewrite of this dry wall of text is not live yet, so let me paraphrase:

You contact us and we book you the flight that gets you to your destination the earliest (if needed we pay for a taxi or bus or anything to get you to another airport if needed.)


> In the case that we are unable to find a reasonable alternative flight(s) or other means of transportation, due to a disproportionate price difference between the potential alternative transportation and the original price for the unused flights, we may agree with you on our proportional contribution to the costs associated with a mutually agreed upon alternative transportation.

This doesn't sound like a 100% guarantee. Most of the times on the day tickets will be a lot more expensive than advance purchases.


Alright, this following comment is not an official communication by Kiwi.com, it reflects solely my personal guesses/opinions.

I'm not sure about the details since I don't have much to do with the legal side of things, but I would assume that Kiwi.com had to put this clause in to avoid having to pay when a flight's price is 1000x higher than it should be as an error fare, or similar cases. I've personally never heard of a case where expenses weren't fully covered because of this clause.


Obviously adequate connection time between flights is an important factor. Especially important if you're traveling with kids.


A 4 hour weather delay will blow away anything I might consider an adequate connection time under normal conditions, so the question seems quite important.


See reply two levels above .-.


Google Flights. I fly 3-4 times per month and it's godsend.


Google flights or matrix.itasoftware.com (you can't book here though)


I use this userscript to book directly from ITA matrix:

https://github.com/SteppoFF/ita-matrix-powertools


I also use google flights but I thought google flights was created after Google acquired ITA software. Isn't it ITA's backend behind google.com/flights?


Yes.


Google Flights is simply a pretty UI around matrix.itasoftware.com, no?


The matrix has nice features like flexible dates on a multi-leg trip that Google Flights doesn't offer.


Google Flights has gradually added ITA Matrix stuff over time.


You can nerd out a lot more with Ita about specific routing and airlines


bookwithmatrix.com


Disclaimer: I created Concorde.

Concorde — Discover cheap flights to hundreds of destinations worldwide: https://concorde.io


Interesting. Played around with it. -What does creating an account provide? -Do you plan on allowing for filters by price, airline and alliance? -Do you pull in deals similar to what is in Flyertalk's Mileage Run forums since many are time limited there? -I'll be checking it for my next flight now. :)


Thanks for checking it out!

1. By creating an account, you can search from your home airport to hundreds of destinations worldwide. 2. Yes, the filters you propose are very achievable in the near-term, meaning that I already have the data, I just need to create the appropriate front-end for viewing it. 3. Exactly. The quality of the deal is intended to be mileage-run worthy, but not necessarily everyone wants to earn miles. I've found a lot of people just want a cheap and fun vacation spot that is somewhere far from home.

Please let me know if you have any thoughts or suggestions for improvement! Thanks!


You mention mileage runs, but is there an option to only receive email alerts about cheap airfare for a particular airline?


Currently the email notifications are triggered based on your home airport. If we post a deal from one of your home airports, we send you an email. However, as I continue to develop the site, I intend to offer more granular settings for receiving email notifications, similar to more granular settings for the Discovery results as well.


I've been using Kayak recently and have found it to be very good.

Relied on their price forecasting tip on one flight the other month. It advised waiting until the last few days to buy, and that paid off.


I used to use Hipmunk for the graphical view, but mainly use Google flights now. It's super fast, and it is more easily viewed on my phone.


momondo.com is the best I found. Not sure how it works for US flights though, since I mostly fly in Europe.


ITA Matrix.


There are services growing in popularity for this. (I don't have any affiliation, I've heard good things, and want to try it.)

https://www.flystein.com


They charge USD 49 do give you a quote..


People on slack, who I've talked to about this service, all said there's been many times where they couldn't beat the price. Still, they did get their money back.


Only if they could beat your price by more than this fee, so you always win.


Seems interesting. Kind of like a travel agent but then again not. Let us know when you try them out.


What is the incentive for airlines who don't offer bargain-basement flights to participate?


Many customers will still choose airlines they like to fly. For instance, I filter Spirit Airlines flights, even if they are offering the lowest fare.


And also flight routes - I'd rather fly with a stopover in Singapore than a stopover in Dubai.


The incentive is to sell to people like me!

* In a second-tier city - no single airline has good options, but by comparing all of them I can usually find a only-mildly-lousy flight.

* Not especially price sensitive, I usually pay up to 2x the cheapest possible fare, to get a better schedule, seats, etc.


> Several of the airlines have dropped out of participating in flight comparison sites, and those that do apparently pay staggeringly little per referral. This is greatly eroded the usefulness of Hipmunk and similar sites, and taken away the motivation for anyone to pressure airlines to participate.

This sounds like something for the Justice Department to get involved in.


Why? Why do You think the justice department needs to get involved? This is a place where capital am actually works. If people only use aggregators then airlines not listed won't get much business. I actually check swa because swa us the online airline that doesn't charge bag fees. So I go out of my way to give them business when I can.


Honestly the price of an SWA flight is usually more expensive than another airline plus bag fees. Plus most airlines will waive the bag fees if you sign up for their credit card (you don't even have to use it).


No, it definitely does not.


[flagged]


Please comment civilly and substantively on HN or not at all.

https://news.ycombinator.com/newsguidelines.html


Anyone have insight into the sale price?

Hipmunk raised $55M over 7 rounds [1] and had 51 employees [2].

[1] https://www.crunchbase.com/organization/hipmunk#/entity

[2] https://www.hipmunk.com/about


Generally when numbers aren't released, it's an acquihire. Which means it probably went for less than the amount they raised.

It became obvious that Hipmunk was never going to be a 100x growth company, and the industry is not headed in a positive direction for small companies (access to accurate data is increasingly a roadblock), so I'm guessing the investors were happy to get out before the value of the company was zero.

I'm sure the employees were given optional retention packages, and the executives likely compensated very well, but I wouldn't expect anyone got rich here.


My guess is that, given it has not been disclosed, the investors got as much of their money back as they could through liquidation preferences and there's not much to get excited about after that.


The employees are probably (mostly) getting to keep their jobs.


Concur's core product is shockingly awful. My company recently switched to it, and I don't know anyone who actually uses it. Most of us have figured out we get lower prices and less hassle by just ordering directly from the airlines / hotels and booking them to or corporate credit cards. If you're in a hurry, we can just call AmEx travel and pay $30 for them to book the trip for us using their travel agent terminals -- which of course have every flight from every airline. The end result is usually that we pay more for our travel and our company loses control; but honestly Concur's application crashes 90% of the time I try to use it with JavaScript errors, so I'm not sure it's really a viable solution in the first place.

The problem, of course, is the commoditization of the airline industry. Leisure travelers are, at this point, loss leaders that fill empty seats for their real business: consultants and sales people who travel 50-100+ flights a year. The industry is overly reliant on an increasingly shrinking segment of business travelers who fly on higher-fare tickets and often on short notice, so it does everything it can to make that kind of travel very painful UNLESS you do it all with a single airline and use full-fare tickets. If you thought air travel was unbearable on your last vacation, imagine how bad it is to do that 3 or 4 times a week -- so you try to consolidate to get a few perks like early boarding, lounge access or first class upgrades (nobody pays for domestic first class -- they're almost always loyalty upgrades).

So the real problem is that the airlines don't care at all about your $200 flight to Tampa to visit granny. They have to fill the seats to pay off the leases on the airplanes, but they make almost zero margin off of you because leisure travelers are so price-conscious. Business travelers are willing to pay an extra $300 for the ability to cancel their ticket on short notice, and often carry less baggage and cost less to serve. So the airlines try to lock in those types of customers with loyalty programs (which are so scaled back as to be nearly worthless unless you fly over 125 segments a year -- roughly 3 flights a week, every week of the year that's not a holiday), by making it harder to comparison shop, etc. and screw the little guys.


Concur is quite possibly one of the worst UI's I've ever used, right up there with IBM Rational Atria ClearQuest or IBM Lotus Notes.


I have no idea what Rational Atria ClearQuest but the name alone tells me it's awful.


I used to use Clearquest when I worked for a bank to hook up to their DB2 and Oracle databases. It was HORRID.

I got to use it with their own homebaked IDE, Rational Developer and VCS, called Rational Clearcase.

I look back at those years and still get shivers down my spine.


bug tracker. fairly customizable.


I use Concur because my crappy corporate employer purchased it. My strong suspicion is anyone who matters makes his or her assistant use concur rather than doing it him/herself.

The product is absolutely awful. Like just stunningly bad.


Most of their assistants just use AmEx travel (or some other travel agency software) -- which has a much higher per-seat license and actually ties in to the back-end reservation systems so you can see all flights, etc. As far as I can tell, Concur sources its data through site scraping in order to achieve the lower per-seat licensing costs (since flight data feeds are very expensive).


Hipmunk and Google Flights are my two go-to tools these days for beginning the search for flight tickets. I use Hipmunk when I know where I want to go and when, and I use Google Flights when I know I want to take a trip, but I'm flexible about both when and where.


You might like to check out a product that I built, Concorde (https://concorde.io), for your flexible travel search needs — you can see the cheapest flights to hundreds of destinations worldwide with just a couple of clicks.


I haven't used Google Flights -- will check it out -- but have taken a similar approach with Skyscanner.com. Basically, if I want to filter a trip based on price without regard to location or travel date. Really fun to play with!


Kayak has a nice tool for that too: https://www.kayak.com/explore

Pretty amazing to find flights to Europe from LAX for under $500 for many destinations in Europe and Asia. Sub-$400 for some destinations too


There are so many ways to search for cheap flights... but so few to search to good flights, across all airlines.


Congrats to the Hipmunk team! I've been using Hipmunk since the beginning, and have found it to be a pleasant way to search for flights. They obviously care a lot about creating a good experience for the customer, which is a lot more than I can say about the big travel sites.

I hope that the team had a nice exit, and that they continue to develop Hipmunk within Concur.


Unless tech crunch got things very wrong, they didn't.

The investors will get a base hit, the employees, nothing.


I bet the investors did OK. Some employees might get a nice retention package, but they'll have to sign a document stating their stock/options are now worth $0, so they can take or leave the retention deal.

The founders probably did OK, but they might have the same type of deal ($0 for their stock, except their retention is probably orders of magnitude better than any employee's).


Concur feels like an odd company to acquire them, but maybe it's to streamline business travel?

Also -- I recently used Hipmunk (been using it for a few years now), but found that it didn't find deals that Chase's rewards portal found, which I thought was terribly odd (why would a rewards portal find better deals?).


The difference is Hipmunk is a metasearch site and relies on the connectivity it gets from travel agencies and airlines directly to power their price feeds and then you book with an agency/airline directly. Chase rewards portal is probably acting as a booking agent so may have access to prices/itineraries that are not found on metasearch sites.


Concur also acquired TripIt not so long ago


Makes a lot of sense to me - where I work, we use Concur to book business travel. Concur's current UI for booking flights is complicated and makes it hard to pick optimal results. I think they could benefit from the team working to improve the feature.


what a shame... I've always loved Hipmunk and its "sort by agony" filter. I have to use Concur at work and I think it's pretty rubbish.


The killer feature of Hipmunk for some of us is the ability to understand some of the ITA Matrix codes and so it's one of the platforms to book an interesting itinerary put together on the Matrix. (If you are interested in this, there is an up-and-coming service which tries to do same called bookwithmatrix and there's a userscript maintained on flyertalk adding booking links to the ITA Matrix itself.)


Does this mean Hipmunk (the site) will eventually be going away?


Hipmunk was cool when it first came out but I haven't used anything besides Google flight search in years. The speed of the interface alone justifies it.

It's either that or book directly from the site if it involves doing something special (ex: award travel).


Their business class search has been broken for months, and they didn't care. Feels like they were on the way out.


A flight search engine that I would be interested in:

The craziest routing.

Instead flying for USD 700 A->Destination or A->B>Destination Fly A->C>D>E>F>G>Destination


Airlines typically don't allow that (unless you buy one-way segments between those nodes).


Concur bought Tripit, which is now in the middle of a bit of a drawn out redesign. They didn't destroy that lovely product, so I have hopes!


Congrats to Adam, Steve and team! Flight search is a tough industry to break into, and they did a great job against the odds to get there.


Congratulations!


Congrats Hipmunk homies!


Congrats guys, I'm so happy the product will live on.


My sincere condolences to all the option holding employees of Hipmunk who will not likely get back what they gave up in salary (due to liquidation preferences and the like, they will be lucky if they get anything, other than golden handcuffs.)

20 years and no equity has taught me that next time I do a start up, I want restricted stock, not options, with an exercise price of $0.01. Or founder stock. In fact, I think the only way to do a startup is a founder (unless you're just starting out.)


I sense righteous bitterness in this post, understand that your life experiences actually happened and respect you enough to come to the conclusion that your response is completely and totally legitimate. Are you comfortable with sharing your life/entrepreneurship story as a HN, reddit, Medium, etc. post or reply to this comment? If not to "get it off your chest" and "move on" so much as to protect others?


Thanks. I am doing that, a bit at a time. I'm not actually bitter, though I think I seem bitter. I am maybe cynical. (maybe they mean the same thing in practice.) But I'm doing well, and I'm not slowing down, I've just seen startup employees get a raw deal way too many times and think the entire "startup culture" is oriented in a way that screws over employees, particularly engineers (without whom software cannot be made. While other functions are absolutely critical too, that doesn't mean the people in those other functions should work 30 hour weeks, and take home most of the payday.)

One of the reasons I'm not bitter is that the VC industry is dying. IT's not obvious yet, but like the headphone jack, its days are numbered.


Whats the difference between and RSU, founder shares and options to buy common shares? If there is liquidation preference on the preferred stock, you'll stick get nailed. Most raises only have the 1x liquidity preference as founders don't want to screw themselves as their shares sit in the common pool.


Even a 1X liquidation preference is screwing the founders. Here's my opinion: Dollars are fungible. If a redneck gives you a dollar for your beanie baby, that dollar is as valuable to your bank or to walmart as a dollar coming from a lawyer in an expensive suit. It should be no different whether that dollar is a dollar in cash from an investor or a dollar in salary that an engineer gives up.

So, If an engineer gives up $70k a year in salary to work for a startup, the "options" should have an intrinsic value of $70k a year (the numbers that vest in that given year.) So should the RSUs. Anything less is cheating that engineer.

Those options or that stock should have the same participation as the venture capitalists. I will accept preferred having some narrow advantageous rights, but it should be only a few that are essential and make sense. Right now these deals are loaded down with double dipping that screws entrepreneurs because it is "standard practice "and "VCs need to cover their risk" -- but this is BS -- VCs have less risk. The VC is in many deals, the entrepreneur isn only one.

If anyone should get LPs it is engineers. So the company I'm founding next will have one class of stock, or if it has two it will be the founders and employees with preferred stock. (and sure VCs will balk, until they are desperate to get in on the deal-- but you should be raising money not when you have an idea or because you want to be able to pay yourself, but when your investors are desperate to get in on the deal. If that sounds unrealistic, then you're following the standard startup model, which is designed to screw founders, and now I'm getting circular so I'll get off this train.)

RSUs can be granted, with no cost, as a form of compensation. I think that's the better way to do it.

Options require an exercise price which is the source of a lot of hassle. For instance an early employee gets pushed out because someone wants his equity, so he has 90 days to come up with $35k/year (so $70k if he's been there 2 years) to exercise his options he's already effectively paid $70k a year (in lost salary) to get.

Options are very tenuous- they can be cancelled or adjusted in acquisitions (according to many terms) etc. RSUs have none of these problems. (Though the tax situation might be worse for them, but that's showing the IRS or the people who lobbied the IRS for the rules, setting it up to screw employees.)

I could go on.

Founder Shares are just shares with special rights for founders. Google and Facebook had them.




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