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Calif. Fair Pay Law Is Unfair To Startup Founders

Law360 (May 16, 2019, 1:46 PM EDT) -- Much is said of the stereotype of the Silicon Valley founders starting the next Google or Apple in their parents’ garage. The same shoestring budget that limits nascent startups from leasing office space is what prevents founders from paying themselves a salary. And the same is often true of initial employees.

It is well-understood in the early stage startup world that founders and initial employees, more often than not, are working for “sweat equity.” The cheap stock grants they get in the initial days and months of a company are a bet on an outsized payoff in mergers and acquisitions or at...

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