Imagine getting an unexpected cash windfall, just for showing up for work.
It sounds crazy, but that’s what happened to D'Anne Schjerning, a secretary from San Jose, California.
She received an extra $1.08 million—that’s on top of her salary.
Andrea Lewis, a journalist from Seattle, Washington received extra money, too…
About $2 million extra.
Meanwhile, David Choe, an artist from Los Angeles, won the “extra money lotto”:
He received a whopping $200 million.
How did these people get windfalls just for coming to work?
And more importantly: how can you get yours?
Incentivizing Employees
The answer lies in how tech companies compensate their employees…
When a new company is getting started, it generally doesn’t have enough money to pay its workers market-rate salaries.
To compensate for this salary shortfall, and to incentivize employees to work hard, a start-up often grants workers “stock options.”
These options give workers the right to buy the company’s shares in the future… but at a major discount.
D'Anne Schjerning, for example, was an early employee at Netscape, the company that created the first internet browser.
Although D’Anne earned just $53,000 a year as a secretary, she was given options to buy Netscape shares at half a penny each.
When Netscape IPOd, those options turned into a $1.08 million profit…
That’s the equivalent of D’Anne tripling her salary for 10 years in a row.
Then there’s Andrea Lewis, who worked as a technical writer for Microsoft. Thanks to her Microsoft stock options, her net worth shot up to a reported $2 million.
And then there’s the story of artist David Choe:
In 2007, instead of taking a $60,000 check to paint a mural in Facebook’s new office, Choe accepted stock options.
When Facebook went public, he found himself $200 million richer.
And thanks to a new internet company, now you can finally get your hands on stock options like these—all without moving to Silicon Valley.
RocketClub
The new company is called RocketClub, and the way it works is simple:
You log onto RocketClub and browse through the listed start-ups.
When you find one you believe in, you sign up to support the company by becoming a loyal user of its product, and by referring your friends. Essentially, you’re becoming a “marketing consultant” for the business.
And if you complete a required set of marketing-related tasks within a certain time frame, you’re compensated with shares in the company.
Why would a company be willing to give its shares away?
Simple:
If enough “grass-roots” supporters like you help promote it, a young company might quickly reach a critical mass of users—and that might be a cost-effective way to jump-start the company’s success.
So now let’s look at how your time and efforts can translate into dollars.
Show Me The Money
The shares you earn for supporting a start-up are like stock options, but they’re called “Stock Appreciation Rights.”
If the start-up ends up getting acquired or going public, these rights turn into cash.
For example, if you earn 500 shares in a start-up, and the start-up is acquired in the future for $100 a share, you’ll receive 500 x $100 = $50,000 minus RocketClub’s management fee.
How much could your rights realistically be worth?
Well, if the company fails, they’ll be worth exactly what you paid for them:
$0.
But if the company turns into the next Facebook, they could be worth millions.
Here’s the math:
Let’s say you’re splitting 1% of the company with 1,000 other supporters, so you each own 1/1000th of 1%.
At Facebook’s current $275 billion market cap, that 1/1000th of 1% would be worth $2.75 million.
What You’ll Find on RocketClub
One of RocketClub’s companies is a travel app called Spottly…
Spottly, which was recently written up in Conde Nast Traveler, provides a platform to discover, collect and share the coolest places on the planet.
In exchange for helping to promote its app, Spottly is offering about 1,000 folks like you a cumulative 2% stake in the firm.
To earn your shares, you’d need to use the Spottly app for six months—posting travel locations that you love four times a month, completing one survey, and referring the company to two friends.
Other companies on RocketClub include Noble Brewer, a service that “connects craft beer lovers to the most talented amateur brewers in the country,” and Co-Parently, a set of online tools that help divorced parents manage shared parenting duties.
The Portfolio Approach
Keep in mind that very few start-ups become as successful as Facebook, or even become successful enough to sell for a profit.
Which is why RocketClub encourages you to support many of its start-ups—just like Crowdability encourages you to build a portfolio of start-ups if you’re investing actual cash.
But whether you’re investing your time or your money, it’s exciting to be part of a young enterprise as it grows—and it’s exciting to share in its profits.
And the best part about RocketClub is that anyone can participate—you don’t need to be a wealthy, accredited investor to earn shares.
To learn more, visit RocketClub.
Please note: Crowdability has no relationship with Spottly or RocketClub. Crowdability is an independent provider of education, information and research on start-ups and alternative investments.
Best Regards,
Founder
Crowdability.com
