At this point, not much surprises me. But just when I need a reminder of how out of touch some folks can be from the "big picture" that surrounds them, I get this post from Erick Schonfeld at TechCrunch:
Google Employees Watch In Horror As 60 Percent of Their Stock Options Drown
I'll let you read the entire article but the gist of it is that, as Google shares fall below the $329.78 level, a significant tranche of employee options fall under water. The article goes on to point out that, at current prices, 61% of Google's stock options are under water. And here's where it gets absurd:
Only eight days ago Google’s shares were trading at $411 and three months ago they were above $450. In that time, a lot of paper wealth has disappeared and along with it incentive for many recent hires to stay. Of course, the stock could rally and everything will be honky dory again, but if Google’s market cap is being fundamentally reset along with the rest of the stock market, it could face some serious retention issues in the coming months. The free food and transportation are great perks and all, but let’s get real here. Without the financial upside those stock options represent, Google employees will start looking elsewhere.
Looking elsewhere? Good luck to them. I'm sure there will be opportunities for enterprise entrepreneurs who are willing to forgo near term security for the potential of future wealth. But for the vast majority of Google employees, it's ASININE for them to be lamenting their stock options. Does it suck to see your optionality go down the tubes? Of course. But worrying about that right now is like Marie Antoinette making sure her face was properly powdered and lipsticked as the guillotine was falling.
What most Google employees should be thinking right now is...
- Wow, I'm damn lucky to have a job with a salary and benefits right now
- I sure hope I've added enough value to keep my job because a lot of smart people are looking for work
- My company has tons of cash, a dominant market position and relative stability, I'm luckier than 90% of those I know
Seriously folks. If you're working for a technology bellwether like Google, Microsoft, Apple, Research in Motion, IBM, etc...and you're feeling bummed out that your stock options are kaput; that's fine. But if you're still so much in the clouds as to what's transpiring that you're thinking, "I'm going to leave and go to a place where I can get richer, faster" then I don't have much sympathy for you. Get a grip on reality. Seriously.
Disclaimer: At the time of writing, the author and/or the firms affiliated with the author maintained a long equity position in Google [GOOG] and Microsoft [MSFT]. The author and the firm reserve the right to alter their investment positions at any time in the future. The content on this site is provided as general information only and should not be taken as investment advice. Content should not serve in any way as a recommendation to buy or sell any security or financial instrument, or to participate in any particular trading or investment strategy. The ideas expressed on this site are solely the opinions of the author(s) and do not necessarily represent the opinions of firms affiliated with the author. Any action taken as a result of information or analysis on this blog is ultimately your responsibility. Consult your investment adviser before making any investment decisions.