May 11--Pinterest is allowing employees who have vested shares in the social media company to cash out, a move that gives its hires more freedom than many technology start-ups award.
A couple of moves announced in recent months, including one last week, could make Pinterest stand out in a competitive hiring environment.
Rather than pay employees the salaries they might get working elsewhere, start-ups sometimes offer "sweat equity." That means employees get compensated in part with generous stock options that could someday be worth millions of dollars if the start-up heads up the right path.
Even when it does though, employees might want out before the company goes public. Family circumstances might dictate a move or as the company grew their expertise was no longer needed. Complicating matters more is the trend of start-ups staying private longer because of the wide-open cash spigots on the private market.
But Pinterest announced Friday that it's allowing employees who had stocked vested by April 30 to sell a small portion of their shares to investors as part of Pinterest's current fundraising cycle. Pinterest allowed a similar sell-off in 2012.
Some companies forbid secondary sales, but a well-known start-up going this route again could spur smaller rivals to follow suit to recruit workers.
The previous change was to allow employees to hold onto shares as long as seven years after leaving the company, rather than the typical 90 days. It gives employees more flexibility in coming up with the cash to exercise those options and delays the subsequent tax hit.
Pinterest's new round of funding has valued it at $11 billion and already brought in $553 million from investors including Goldman Sachs and Wellington Management Co.
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Update
2:59 p.m. Updated with additional information from Pinterest
