Tag Archives: Andy Rachleff


The Post-IPO Dilemma: Hedging Your Stock

If your company recently went public and your stock price has gone up significantly then you’re probably wondering how you can hedge your position. Unfortunately there’s nothing you can do while you’re still in the 180-day lock-up period. Most lockup agreements have extremely detailed restrictions included, designed to prevent almost any form of market participation with a security.  It’s too long to reproduce anything but a sample here, but it typically begins like this: In consideration of the Underwriters’ agreement to purchase and make the Public Offering of the Securities, and for other good and valuable consideration receipt of which is hereby acknowledged, the undersigned hereby agrees that, without the prior written consent of each of [names of managing underwriters], […]

Making the Case for Financial Planners

There are a number of value-added services that can improve your financial future.  In the past we have written about the benefits of engaging a tax advisor and an estate planner. In this post we make the case for financial planners. We believe financial planning can make a huge impact on people’s lives. That’s why we have dedicated a number of our blog posts to the topic.  However we are aware that many people could benefit from having an expert to drill down further on the covered concepts.  That’s where a financial planner can really help. In our experience there are five primary areas where a financial planner can add value: Cash Flow & Budgeting Asset & Debt Management Helping […]

WhatsApp: What an Acquisition Means for Employees

The announcement that Facebook is buying WhatsApp for $19 billion generated a lot of interest. The most popular question we received is what does the acquisition mean for the employees financially. IPOs tend to get all the headlines, but in many cases technology companies are acquired. This post will walk through the economics of an acquisition and how it affects all the parties involved. The Terms of the Deal From what I have read, Facebook will acquire WhatsApp for $4 billion in cash and approximately $12 billion worth of Facebook shares. In addition Facebook will grant $3 billion in RSUs to founders and employees that will vest over the next four years. I do not have any special insight into […]

Announcing Adam Nash as CEO

Today I am thrilled to announce that Adam Nash has succeeded me as CEO of Wealthfront.  When Dan Carroll and I co-founded Wealthfront, we had one mission in mind, to democratize access to sophisticated investment management.  We knew that to achieve our audacious goal would mean building great software and fostering a culture that would attract outstanding talent. We also knew our limitations. Prior to co-founding Wealthfront I was a career venture capitalist who retired to teach entrepreneurship at Stanford Graduate School of Business.  My background prepared me to find product/market fit, but I knew I wasn’t the most appropriate person to scale the business. So we were unbelievably fortunate one year ago to have Adam join us as our […]

How Long Should You Stay At Your Job?

Over the years many people who have been granted options or RSUs have asked me for advice as to how long they should stay at their employer. As with most questions the answer is it depends. It depends on your happiness, the company’s prospects and your career path. For many people, four years seems to be about the right span of time. It’s no coincidence vesting periods for most companies are four years, but your decision to stay at a job should not be driven by your vesting schedule. Don’t job hop, but don’t be miserable, either People who are interested in maximizing the diversification of their private company option or RSU portfolios tend to only stay at each company […]

Should You Get An MBA?

If you’re considering an MBA, you face two separate but related questions: Is the degree worth it? And, How will I pay? They are important questions because so many people, including many of our clients, consider going back to school when they want to change careers. But an MBA isn’t an automatic ticket to success, and it carries a high price. A full-time MBA at a top-ranked school costs between $96,000 and $127,000 in 2011, according to Businessweek. The costs at second-tier institutions (many of them big state schools) are $30,000-$40,000 less, but that’s still hefty. The price of school is only the beginning. The opportunity costs of forgoing two years of salary and career advancement are likely to be […]

Do You Need A Private Banker?

A private banker is someone who focuses on the needs of wealthier-than-average clients. Sometimes, he or she works for a private bank within a large institution, like J.P. Morgan Private Banking; other times, his or her institution is a private bank, like U.S. Trust. Private banks used to exclusively serve people with millions of dollars in assets, but in recent years they’ve been broadening their services to appeal to people with somewhat less. After your company has an IPO or is acquired, you might get a knock on the door from a private banker. In this recent Quora post, Wealthfront CEO Andy Rachleff listed the pros and cons of using a private banker. Among the pros: A private banker might […]

The 12 Crucial Questions About Stock Options

Next time someone offers you 100,000 options to join their company, don’t get too excited. Over my 30-year career in Silicon Valley, I’ve watched many employees fall into the trap of focusing on the number of options they were offered. (Quick definition: A stock option is the right, but not the obligation, to buy a share of the company stock at some point in the future at the exercise price.) In truth, the raw number is a way that companies play on employees’ naiveté. What really matters is the percentage of the company the options represent, and the rapidity with which they vest. When you receive an offer to join a company, ask these 12 questions to ascertain the attractiveness […]

Wealthfront Returns To The Big Apple

Online financial advisor Wealthfront rings NASDAQ in New York

Wealthfront will be in New York City Feb. 28 – March 1 to meet with members of the Big Apple’s tech community. The visit coalesced when Wealthfront’s General Counsel, E.J. Borrack, a New Yorker, attended a lunch with Janet Hanson, the CEO and founder of 85 Broads, a global women’s network. The lunch featured a private viewing of Elizabeth Taylor’s jewels before they went to auction at Christie’s. Ms. Hanson is an advocate for women and entrepreneurs and has a longstanding interest in New York City’s tech community. After E.J. and Ms. Hanson bonded over bling, they discovered that they shared an interest in technology entrepreneurship, and that Ms. Hanson had been talking with Wealthfront’s CEO, Andy Rachleff, to devise […]

Does Your Financial Advisor Think You’re Clueless?

Wealthfront’s CEO Andy Rachleff published a column last week on Forbes.com about how this generation of IPO wealth may help transform the business of money management. It offers a sharp contrast to the attitude that many Wall Street brokers take toward their clients, which was obvious in an article that ran last week in the New York Times (more on that below). In Hey, Silicon Valley Engineers, Time To Toss Out The Bankers, Andy wrote: This era’s IPO wealth is being created by young, Web-savvy engineers who have a deep-set aversion to traditional, expensive ways of doing things. They also have a deep understanding of how to use the Web to manage all aspects their lives (and possibly yours – […]