Employee-VC Alignment

One of the highest-valued private technology companies, grocery delivery service Instacart, announced last month that it has cut its valuation 40%, from $38 billion to $24 billion. To be more specific, the 409A share price (or value of a share of common stock) went down in its most recent third party analysis, such that the company is now valued at... See more

The past several years have been characterized by higher and higher private company valuations, which, when the public markets for tech companies reset over the past few months, left venture capital investors that had invested in later stage private rounds in the red on these investments. In other words, not dissimilar from the issues that employee... See more

In short, when a private company raises less capital at lower valuations, employees have the chance for more upside if the company succeeds.