"Imagine you work for a company and your stock price has just skyrocketed. Think Nvidia, up more than 1,100% over the past few years to become a $4.5 trillion company. Or Broadcom and AMD, two other chipmakers whose shares are surging in the AI boom. Employees of these companies must be feeling pretty good right about now. What could possibly go wrong?"
"My colleagues Geoff Weiss, Hugh Langley, and Rosalie Chan wrote this weekend about the latest golden handcuff trend sweeping through Silicon Valley, particularly at the AI chip companies. In one case, they reported that an equity package of $420,000 given to an Nvidia employee in 2023 is worth almost $2 million today, citing data from Levels.fyi. Even a more modest $66,000 RSU package reported by a Broadcom employee in 2023 has jumped in value to around $267,000."
Employees at fast-rising chip companies often receive significant compensation in the form of restricted stock units (RSUs) that vest over time. Rapid stock appreciation at companies like Nvidia, Broadcom, and AMD can multiply the value of those equity grants by several times. Unvested RSUs are typically forfeited if an employee leaves or is terminated, creating financial disincentives to change jobs and producing 'golden handcuffs.' Examples show modest 2023 equity packages ballooning into substantially larger sums within months or years. The vesting schedule and the risk of losing unvested stock make career mobility costly for many employees.
Read at Business Insider
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