Comment by ergsef

3. It's very hard to know what kind of compensation employees are actually getting in an acqui-hire. I've been involved in a few of these - money flows through the cap table, so investors and founders get most of it depending on liquidation preference. Retained employees get a typical, levelled offer + some cash/stock (probably more stock) incentive with the usual 1 year cliff and 3-4 year earn-out. Incentives are also usually contingent on specific business goals.

In other words, the scenarios I've seen if the acquired company is not doing well the acquirer pays off the investors and gives the employees a small bonus contingent on staying for 1+ years and hitting goals. It's not necessarily a crazy windfall.