I don't agree. The Silicon Valley dream is to find some newly emerging technology, beat everyone to market with it, take the company public and make HUGE money on your stock options.
It's quite possible that this CFO is good friends with the founders of such a start-up company, and sees an exciting opportunity with them. If he stayed with SIII, he could say double, triple or perhaps quadruple his incentive option shares in the next few years. If he takes the risk, and goes with a private upcoming tech company, he could get returns of 10, 50, 100 fold on a much greater number of shares. His salary won't probably change all that much, but his upside opportunity will. Look at all the billionaires (at least 3) MSFT has made, with large numbers of millionaires. Look at NSCP... Marc Andressen <sp?> went from being a relatively new college grad probably making around $50k a year to being at least a $100 millionaire overnight (when NSCP went public).
About a year ago I weighed a few job offers in the high tech field. I chose to go with a public company that I felt could easily grow 3-4 fold in a couple of years and make a good return on a mid four figure (# of shares) incentive stock option, and was fairly certain they would do so. The other offers were with privately held companies that offered high five-to-six figure incentive stock options that would have cost me pennies to exercise. One of those two companies just had about 25% of it's employees leave because they aren't doing well. The other company is about to go public. Did I make the right descision? That's open for debate, but I feel I did because I chose the best balance of risk/return I saw availible to me. I think that's the case with the CFO as well. It certainly doesn't mean SIII won't do very well. |
