Google Faces Employee Retention Challenge 339
prakslash writes "60% of Google's 1900 employees now hold stock options worth at least one million dollars. According to experts in this Reuters article, it is now imperative for Google to maintain its sense of mission. If it fails to do so, a whole slew of employees facing post-IPO burnout and boredom will leave the company to go back to school, start a new company, or join the ranks of high-tech early retirees. Such a mass cashing-out could lead to a decline in Google stock price and intellectual brain-drain. Oh how I wish I worked for Google."
It's a problem, but it's already solved. (Score:5, Insightful)
Not only do they have the problem of suddenly having a few hundred jobs to fill, but they also have the problem that nearly everybody in the world would like to work for them. By setting up such qualifying quizes before even asking for a resume, Google's trying to filter out the best applicants early in the process so that they don't waste their time on pursuing people they'll not end up hiring.
So, yes, Google's going to lose some key talent because they've just created a bunch of modern-era dot-com millionaires. However, they'll just hire somebody else to replace anybody they lose and will move on.
Doing something interesting (Score:5, Insightful)
Well good. (Score:5, Insightful)
Re:You wish you worked for google? (Score:5, Insightful)
Maybe not that bad... (Score:5, Insightful)
Even if it is only subject to capital gains taxes, that takes a bite too. The article only says at least one million... doesn't say what the average is or anything. Also, it doesn't mention any selling restrictions.
The way the market goes with these things, I don't expect the valuation to stay at 180 P/E for all that long... I could be wrong, but I suspect this will be a self correcting "problem".
I sure wish I had the problem. [4 time stock option looser]
Billboard 'recruitment' test? Marketing. (Score:5, Insightful)
If they really wanted to use that sort of approach to resumé filtering they'd have used a hard puzzle and put a time limit on it. In reality, it was a marketing tool - albeit quite a good one, in my opinion.
Re:Not facing it, in reality (Score:5, Insightful)
No company can create something and just sit on it and remain in a market position. If MS couldn't parlay its success with MS-DOS into its success with Windows 95 into its success with IE and 98 and XP...
Yeah. Nobody would still be using MS-DOS today. They'd all be using Linux or BSD or something.
So Google does need talent to stay competitive.
Totally expected (Score:3, Insightful)
When you're hiring someone, it's absolutely CRITICAL not to pay someone enough to be "comfortable". It removes all motivation, and makes for unmotivated and uninterested employees.
Management 101, and a quick lession any hiring manager would learn if they didn't already know.
Giving people piles of cash in options, is one of the mistakes startups make over and over and over. And this is normal to the process.
But, that's the fun isnt it
Re:Billboard 'recruitment' test? Marketing. (Score:5, Insightful)
Google Labs (Score:5, Insightful)
Re:You wish you worked for google? (Score:5, Insightful)
Americans use the term CVs as well. Americans with advanced degrees. If you want a seriously nerdy position at google (instead of clerical), you'd do better with a CV instead of a resume.
Feel free to use a dictionary and note the difference between the two terms. I have both a CV and a resume and I'm still an American.
Re:Totally expected (Score:5, Insightful)
reminds me of... (Score:5, Insightful)
They interviewed some ex Microsoft employees. All of them are millionaires due to stock options. Now they are mostly in their late twens wondering what to do with their existence for the rest of their time (one of them - living in his huge mansion alone said that he pretends to be into IT consulting on dinner parties, because saying that you basically do nothing is kind of embarrassing).
It makes me wonder if stock options are really a sustainable way for both sides to grow. Wouldn't it be better to have more employees at a lower wage like 500 grands a year? Every ex MS worker being part of the documentary suffered some kind of burn out syndrome, so it might make sense to reduce their workload at the same time.
Re:Totally expected (Score:5, Insightful)
If all you hire is people wanting to move up to $70K a year, instead of people looking for new cool things to do, then, yes, you create the lack of motivation that money seekers get.
this article is worthless (Score:5, Insightful)
Recently I was interviewing with Google in Mountain View (and I'm posting AC for that reason) and I didn't meet a single person there who seemed like the IPO had affected them at all. Some engineer made the comment to me "Yeah, I ended up with a lot of money after the IPO, and the thought crossed my mind to leave, but what would I do? I can't think of any place I'd rather work."
Everyone loves to hate on Google now that they're no longer the scrappy underdogs. But after walking around the "Googleplex" I can't say I've ever seen a company where the engineers were happier.
Re:Maybe not that bad... (Score:4, Insightful)
and they must have quite a number of people with 10m+ too.. who got those options by being in important positions.. you can only buy loyalty so far before you've given so much money they don't need you anymore(at which point you gotta think of some other stuff like giving them intresting jobs to keep 'em).
This is the best kind of "brain drain" (Score:3, Insightful)
The Way Things Are (Score:3, Insightful)
The thing to understand is that like other cutting edge Internet companies, Google is no longer what it was. It is now a publicly held company with ONE SPACIFIC THING in mind for its mission: Produce cashflow for its stockholders. This is now Google's "mission". One day, it will be the mission of many of today's successful Open Source brainiacs. This is the way things tend to flow in a free society, people for the most part are driven by the need to survive and live in comfort.
vesting ... (Score:5, Insightful)
Options usually vest over a number of years, so while they may be worth a paper-$1m, they're only going to see real-$1m if (a) they keep working hard/smart enough to keep the paper-value high, (b) they keep working long enough to cash in the paper-value to get real-value.
This is exactly what options are designed to do!
With regard to "brain drain", for a company like Google, it would have people champing at the bit to work there: so any lost talent is easily replacable with new hires, if they keep standards up in the hiring process. And, it's good to have fresh talent come in over time to keep revitalising the place.
Finally, as others have mentioned, many of these types of people actually like what they are doing. I can tell you that if I were a millionaire, I'd live a nice lifestyle, but I'd still be pottering around on code or doing something creatively interesting -- (a) because that's what I like to do, (b) I'm just not the type of person to laze around doing nothing.
There are _many_ examples of serial millionaries and creative types who do what they do because they love the creative elements.
Re:You wish you worked for google? (Score:1, Insightful)
Thank you GOOGLE!!!!! (Score:4, Insightful)
America is still the land of hope and promise, even though our leaders are trying to crush the hopes and dreams of the American spirit with FEAR, UNCERTAINTY, and DOUBT! Thanks again GOOGLE, you are a bright ray of light peeking through the gloom.
What if the unthinkable happens? (Score:5, Insightful)
What better place to increase your own wealth but where you have had and can continue to have influence on its growth.... as opposed to some disconnected, abstracted stock market game of chance...
Imagine what those who got out early with MS would regret now!
On teh more intelligent side of this, don't ya think the google guys would have considered this... especially given all the apparent presidence...???
Re:this article is worthless (Score:5, Insightful)
It's the usual Slashdot jeasously. Anyone who has any sort of success must be torn down. I'm a loser so I'll sit around Slashdot pumping myself up by putting others down.
Hmmm, kind of like I just did.
C'ya Slashdot. Over and out...
Pass the Champange (Score:5, Insightful)
Re:Maybe not that bad... (Score:2, Insightful)
So, what would it take? $3 million, $5 million? Even that won't be enough if you don't figure out how to manage you new wealth very quickly.
Since you do have debt beyond a mortgage, that indicates you're not great at living within your means. Getting a whole pile of cash all at once is not a good way to learn money management. You're much better off to learn with live within your means before getting the big windfall, but if you can do that then you probably don't need it. Ironic, huh?
Re:Thank you GOOGLE!!!!! (Score:3, Insightful)
Re:Maybe not that bad... (Score:2, Insightful)
Re:You wish you worked for google? (Score:4, Insightful)
Re:What if the unthinkable happens? (Score:4, Insightful)
1. Short-term capital gains @ ordinary income. Ouch. Tax man cometh. Depending on what the new president does with the tax laws.... 35-39% for federal, maybe up to 10% for state. All the folks espousing their liberal viewpoints I trust will enjoy giving up 45% - 50% to Uncle Sam because they are now "evil rich people".
2. People who receive a windfall of money, such as lottery ticket holders, about 95% of them blow the money within 3 years. If you didn't earn it by struggling, you're not going to struggle on keeping it. Sorry to say, but they will also probably not go to see a NAPFA-certified [napfa.org], fee-only financial planner, either.
Think of how many True Hollywood Stories you've watched on E! that have the same sob story.
3. The exception to this is when it is annuitized, which would provide a certain amount of money per year for a certain amount of time. In which case, it would be more like a salary without work.
4. A lot of these people are not vested. By the time they're able to exercise their options, the stock will probably be down at a level more in line with reality. If you're not liquid, you're only a millionaire on paper.
5. Some people may own restricted stock, so this would impede their ability to convert it to cash. Again, another liquidity issue. By the time they are able to sell the stock, the price will have deflated.
6. Money doesn't buy happiness. Most people would not enjoy laying around all day, past maybe 1 year, because your purpose in life becomes basically to consume. There are only so many cars and so many Rolex watches one can buy before it becomes old really quick. People need purpose and vision.
There are actually psychologists who specialize in treating folks who receive a windfall of money. You don't realize that, when you receive a large sum of money or inherit something grossly large, some of your dreams, aspirations, and hopes are destroyed.
Helpful hint that no one does. Here's how to turn into a "rich person" while keeping sane. If you save just 10% of your income, starting today, each year, in 20-30 years, you'll be right there... but you'll have done it organically and have your common sense about you.
Its worse than that: (Score:4, Insightful)
Another problem are the 40% of people who AREN'T going to be millionares. When your co-workers who don't get to quit start driving into work in expensive cars, etc, its going to be hell on morale.
Re:Who really cares about money? (Score:4, Insightful)
As it's often been pointed out, there are practically no scientists out there who have achieved any great/notable work after they were married and had kids. This is no accident.
When you make the decision to start a family, you effectively trade off much of your former "free time" in an attempt to reap the benefits and experiences/insights gained from bringing a new child into the world and from forming a "life partnership" with someone else, to solve day-to-day matters together.
The "free time" you would have had before that is the commodity used by inventors and creative types to come up with innovative/original ideas and works.
Re:You wish you worked for google? (Score:2, Insightful)
Maybe in 3 - 5 years, when most of the millionaires have left, but I would certainly NOT join Google right now
So the fact that there's a lot of millionaires there is the main reason you're not working there?
Yeah, right ;-)
Re:You wish you worked for google? (Score:5, Insightful)
They weren't trying to rape their IPO buyers. They were trying to prevent Google from being raped buy the investment banks who traditionally lowball the IPO price knowing there will be a huge first day appreciation as the market prices the stock closer to what it's worth (to the market, that is), and the ibanks and their large institutional investors (mutual funds, pension funds, etc.) can pocket the float. But that float doesn't belong to the iBanks, it is value created by Google and no one else, and it should rightfully be pocketed by Google. The ibanks get it only because they control the financial system - they're the gatekeepers, and the toll has been massive, until Google executed the first Dutch Auction with a high float price. So I have no problem with what Google has done, which is basically to ensure they get roughly what they have earned.
IMHO it will be a great day when open electronic IPO networks make the market more freely accessible to new companies looking to go public, and they'll no longer have to go through the ibanks in the manner they do now. A similar paradigm shift happened when stock trading went online in the 90s, and then went to no/low-fee trades. Banks hated it, but consumers loved it, and some banks adapted and learned to profit from it. I think other areas of finance, IPO's for one, are ripe for such a change. I don't expect to see it soon, and don't pretend it will be technologically or politically easy, but hopefully it will happen one day, and I think Google may have taken the first small step in that direction.
Re:Umm... (Score:3, Insightful)
Yahoo itself was a search engine company/portal and with its acqusition of Overture, it now also incorporates technology and algorithms from Altavista and Inktomi as well.
I am not surprised at all that Yahoo's search results are just as good as Google's, if not better.
Re:The Way Things Are (Score:2, Insightful)
When you date a woman, do you tell her you want to take her home and fuck her or do you talk about everything except fucking?
Some people...
Re:google share are just hype (Score:3, Insightful)
Now, GM isn't just about cars. They're about a LOT more. I can't think of any single thing they can totally screw up to drive their stock price all the way down.
Re:It's a problem, but it's already solved. (Score:3, Insightful)
It depends how you set up vesting. Sure all those people might be wealthy on paper, but how many can actually cash out even if they wanted to? Usually options vest over 3 or 5 years. That means after the first year after the IPO, you can exercise only 1/3 or 1/5 of you options. By that time, as many dotcommers discovered, they might be underwater.
It would save a whole lot of paperwork & accounting nightmares.
I agree that a fair profit-sharing scheme is probably better for shareholders of a traditional company, but given that the only people holding Google stock are speculators anyway, they oughtn't to be complaining that employees are effectively speculating too.
Grab while the grabbing's good (Score:3, Insightful)
As such they will clamp on to their options and shares, linger on and eventually see their value erode, like so many engineers have seen past the bubble. To add insult to injury they will have paid taxes on the options.
So here's a sound advice to anyone in a similar position: grab while the grabbing's good. If you linger, the grabbing times might pass you by.
Re:FOD (Score:1, Insightful)
That's nice of you, but it just means your manager does not do her job properly. It means fuckup in planning and it means you are seriously understaffed. And if you work a lot more then you suppose to - you do make errors.
You are or maybe your manager going to be burned out..
I understand a challenge in hiring right people, but it's still possible ;)
Re:The Way Things Are (Score:1, Insightful)
If I IPO'ed a company, using a prospectus that stated that I was going to take all invested money, put it in a large pile, smother it in barbecue sauce, and consume the entire thing over the course of six weeks, I could. And I might even get sued if I used any of the money for any other purpose (even a revenue-generating one).
Re:You wish you worked for google? (Score:1, Insightful)
Re:Billboard 'recruitment' test? Marketing. (Score:3, Insightful)
I tried that on a test once. They didn't buy it then, either.