I think they clawed back unvested options from many employees, who had unvested options with substantial value. That breaks the implied social contract of a startup. If the company is wildly successful, they'll try to claw back your unvested options, which makes startup equity even less attractive than it would otherwise be.
Zygna isn't the only one that did this. Didn't Facebook also do this?
(So in a startup, you can be screwed with options in three ways. If the startup fails, your equity is worth zero. If there's a low-value buyout, the common shareholders can get nothing. If the startup is wildly successful, the company will claw back your unvested options. Why join a startup for equity if you're going to get cheated when you hit the 100x home run?)
Zygna got what they deserved. With changes to the way Facebook promotes their feeds and the switch to mobile, they lost most of their market.
This is the problem with the US's "at will" employment. It affects white collar tech employees too. If you could only be fired for stated misbehaviour (like in the EU), this wouldn't have been possible.
Zygna isn't the only one that did this. Didn't Facebook also do this?
(So in a startup, you can be screwed with options in three ways. If the startup fails, your equity is worth zero. If there's a low-value buyout, the common shareholders can get nothing. If the startup is wildly successful, the company will claw back your unvested options. Why join a startup for equity if you're going to get cheated when you hit the 100x home run?)
Zygna got what they deserved. With changes to the way Facebook promotes their feeds and the switch to mobile, they lost most of their market.
http://blog.sfgate.com/techchron/2013/06/04/why-zynga-is-fai...