Six months ago, Rachel Powers was in startup heaven, with a pocketful of wireless technology stocks and a new job with a San Francisco startup that promised her options to buy even more. In those days of wine and roses, the 28-year-old Web user interface designer held the same hopes that many techie hotshots had back then: She was going to be much wealthier before long.
What happened next is by now a familiar tale. For Quios, startup slump came in the form of pink slips handed to 35 peopleâ€"25 percent of its workers. Luckily, Powers had foreseen trouble and avoided the layoffs by one day when she accepted a Web design post at Arthur Andersen Nov. 1.
What's left of her stock option dreams? Potentially, little more than a pocketful of air. While Quios has yet to launch an IPO, Powers said she was promised 10,000 shares of its stock, plus an option to eventually acquire 6,500 more, in her employment contract. "When I was hired, shares of our competitors' stocks were trading at a minimum of US$18," she says, giving her hope that once the company went public, Quios shares would eventually attain a similar value. With the layoffs, she believes those hopes were dashed.
She did earn something from the experience: a new appreciation for old-fashioned criteriaâ€"job stability and the potential for long-term career growthâ€"to gauge potential employers. Powers isn't alone. According to a survey in September of 2,000 undergraduates, many find the idea of stock options risky.
Online job listings site Jobtrak.com, owned by Jobtrack, in Los Angeles, found that half the students surveyed would prefer a higher-salaried job without stock options to a lower-salaried position with stock options, regardless of the industry or type of employer. Recent job seekers such as Mike Cacciapaglia are also taking a much closer look at companies' business plans, management teams and technology rather than jumping at a job based on the offer of substantial stock options. Because of this new wariness, companies such as Concero LP, an e-business professional services firm, are having to add job training and additional vacation into benefits packages to lure techie talent.
