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Revolut engineers won't (really) be hurt by falling valuation

Getting paid stock in a startup used to be an exciting bonus to joining fintech. Nowadays its a gamble. Revolut may be on the verge of a valuation decrease soon, but will its staff really be hurt by it?

For top unicorns operating in the fintech space, a key factor attracting top talent has long been the inclusion of stock in their compensation plans. Fintechs like Stripe have historically paid stock in a variety of ways such as RSUs (restricted stock units) that give their employees more vested interest in the company and allow them to benefit more from the company's success.

Things have changed over the past year as funding rounds diminished and valuations plummeted. Revolut is still operating with the $33bn valuation it achieved in 2021, but as investors gradually reduce their appraisals of the value of their stakes in the company (Schroders pretty much halved its valuation this week), it seems unlikely they can operate at that value forever. 

This is something all the biggest fintechs have to face. Stripe recently halved its valuation as part of a funding round to give its staff a chance to sell their RSUs  (and cover tax liabilities associated with employee stock), but for Revolut's staff, the negative impact of a decreasing valuation really isn't that important.

Salary data from levels.fyi tells us that stock payments at Revolut aren't too common, nor are they particularly large when they do occur. Of the 13 posted salaries in 2023, only three reported stock payments and two of those were less than $10k.

The largest stock payment at Revolut on Levelsfyi this year was $60k, just a third of that engineer's total compensation. This is nothing compared to Stripe, where it is more common to be paid over $100k in stock than to not be. The highest engineering stock payment so far this year was $640k of a TC just over $1M. Given its valuation drop, it is unlikely he would have received that full amount in the RSU buybacks.

Levels data on alternative employee roles is more scarce but indicates that this may not be uniform across the company. Product managers for example appear to get stock payments more frequently with the most recent salary reported being an entry level hire receiving $18.1 in stock payments.

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AUTHORAlex McMurray Editor

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