Tech Employees Want to Cash in Early

By Kevin Spak,  Newser Staff
Posted Aug 21, 2009 2:29 PM CDT
Facebook CEO and founder Mark Zuckerberg speaks to press and advertising partners at a Facebook announcement in New York, Monday, November 6, 2007.   (AP Photo/Craig Ruttle)

(Newser) – Facebook’s recent deal to let employees sell some of their stock to private investors has sent Silicon Valley scrambling, as workers at other start-ups ask for similar deals, the Wall Street Journal reports. Start-ups rely on the promise of future stock sales to lure and retain talent, but with the market upheaval scaring most companies away from public offerings, employees are getting restless.

Facebook itself found that demand to sell outstripped the $100 million that Digital Sky Technologies had earmarked for buying employee shares—and the clamor for similar deals is leading other companies to try to accommodate, hoping it’ll keep talent happy while giving them more control over employee transactions with third parties. But some fear that offering such deals sends the message that the company’s value is falling. “I’m not convinced that liquidity equals retention,” said one venture capitalist.