Is it better to ask for a raise before a spin-off / merger or after?
I would guess that before the spin-off, more money would be available In my experience the reverse is true. The finance folks go into overdrive tightening everything up so that budget forecasts for the transition period are as accurate and predictable as possible. This can be true 6 months out, 12 months out, etc - depending on the size and complexity of the business. So in terms of when to renegotiate, I think approaching the issue after the dust has settled is more realistic. Make sure you know your numbers as per normal and just remember that after the spin-off has occurred it's a business like any other business: if you are in position to negotiate (and reasonably expect) a raise then the fact that they spun off recently - a month or two before - is meaningless to the negotiation. gef05 hit it on the head -- the books get frozen when mergers/spinoffs happen. I worked as an IT guy at a company whose mission was operating call centers -- and they didn't bother paying the phone bill! Why? the terms were already agreed upon, and the powers that be were waiting for final legal sign-off. Try to figure out who the leaders are going to be after the spinoff, and start politicking them. "Corporate restructuring makes everything a flux, so you might as well revisit some core fundamental questions. Here's how to do this professionally: Start floating your CV now. Line up interviews in competing companies. Attend to them. Score a job offer, and have it put into writing, with exact salary, which should be at least 10%++ of your current one. Take a clear empty page, and write on top: ""Business value provided"". Put down your major contributions, and achievements. Wherever possible, put the company's expected dollar value near to it. For bonus points, sum it up on the bottom, and minus your current salary. Difference is ""Profit provided directly to the company's bottom line"". Float this to your manager's desk. At this position, you have only one fundamental question to your boss: ""match or pass?"" :) A corporate spin-off is a good time to do this: 1, to ensure, that your position will not be made redundant; 2, if it is, you have a backup plan. If the parent company's ""getting rid of you"", however, there are even more fundamental questions you might want to ask yourself: is this really a profitable division, or merely a loss leader? Does this company have a future, and the adequate growing options for you, personally?  To answer these questions, you must have an opportunity cost estimation; and for that, you must have second (and preferably, third) options -hence, the strategy above. To conclude, the best time to do your job research is every other month; and the best time to ask for a raise is always now :) Good luck!"
"No, I understood your question perfectly.  I'm just saying that sort of situation is generally rare.   A quick Google search yields [this article] (http://www.investopedia.com/financial-edge/1112/small-business-financing-debt-or-equity.aspx) which responds to the question - Which funding method should I choose? with the answer ""Often you will not have a choice"".    That is exactly what I'm saying.  The status and stage of your business dictates what sort of financing is even available to you.  Most often you don't even have a choice between one or the other.  If you want a formula, the other people responding mentioned [WACC] (http://www.investopedia.com/terms/w/wacc.asp) which is the ""standard"" that finance professionals typically use.  You generally will want a WACC that is similar to other successful companies of your similar size and industry.  The actual mechanics of adjusting your WACC will involve either issuing (or repurchasing) equity or debt.  Regardless, what you are asking is not generally practical nor does it come into practice in 99 out of 100 financing situations.  WACC is important to understand and consider but people don't issue equity or debt just to balance their WACC.     Think about this another way... how easy is it to raise debt?  Probably fairly easy as usually you can go to commercial banks or go to an investment bank if you're raising enough debt.  Companies borrow all of the time, they're constantly paying off loans or taking new ones with different interest rates.  There are revolving lines of credit, secured loans, factoring (borrowing against receivables), EETCs, fixed interest debt, variable interest debt, mezzanine debt, etc etc.  How easy is it to issue equity?  Pretty amazingly difficult... sure you have your IPOs but that happens once in a company's lifetime.  You might have [secondary offerings] (http://en.wikipedia.org/wiki/Secondary_market_offering) or [follow ons] (http://en.wikipedia.org/wiki/Follow-on_offering) but those are incredibly rare... I mean you've probably never even heard of them right?  You don't hear about Apple or Boeing doing those every quarter do you?  You'll hear about private equity companies buying up firms and you'll hear about mergers all of the time but again those are once-in-a-company's-lifetime events.    So now that you've read that.. how often is a company **really** going to be deciding between debt and equity?  Not very often." I wouldn't say you should have any particular limit, but it can't hurt to have a higher limit. I'd always accept the increase when offered, and feel free to request it sometimes, just make sure you find out if it will be a hard or soft inquiry, and pass on the hard inquires. From my own experience, there doesn't seem to be any rhyme or reason to the increases. I believe each bank acts differently based on the customer's credit, income, and even the bank's personal quotas or goals for that period. Here is some anecdotal evidence of this: I got my first credit card when I was 18 years old and a freshman in college. It had a limit of $500 at the time. I never asked for a credit line increase, but always accepted when offered one, and sometimes they didn't even ask, and in the last 20 years it worked it's way up to $25K. Another card with the same bank went from $5K to $15K in about 10 years. About 6 years ago I added two cards, one with a $5K limit and one with a $3K limit. I didn't ask for increases on those either, and today the 5K is up to $22K, and the 3K is still at $3K.  An even larger disparity exists on the business side. Years ago I had two business credit cards with different banks. At one point in time both were maxed out for about 6 months and only minimums were being paid. Bank 1 started lowering my credit limit as I started to pay off the card, eventually prompting me to cancel the card when it was paid in full. At the same time Bank 2 kept raising my limit to give me more breathing room in case I needed it. Obviously Bank 1 didn't want my business, and Bank 2 did. Less than a year later both cards were paid off in full, and you can guess which bank I chose to do all of my business with after that. There are kind of two answers here: the practical reason an acquirer has to pay more for shares than their current trading price and the economic justification for the increase in price. Why must the acquirer must pay a premium as a practical matter?  Everyone has a different valuation of a company.  The current trading price is the lowest price that any holder of the stock is willing to sell a little bit of stock for and the highest that anyone is willing to buy a little bit for. However, Microsoft needs to buy a controlling share.  To do this on the open market they would need to buy all the shares from people who's personal valuation is low, and then a bunch from people whose valuation is higher and so on.  The act of buying that much stock would push the price up by buying all the shares from people who are really willing to sell.  Moreover, as they buy more and more, the remaining people increase their personal valuation so the price would really shoot up.  Acquirers avoid this situation by offering to buy a ton of stock at a substantially higher, single price. Why is Linkedin suddenly worth more than it was yesterday? Microsoft is expecting to be able to use its own infrastructure and tools to make more money with Linkedin than Linkedin would have before.  In other words, they believe that the Linkedin division of Microsoft after the merger will be worth more than Linkedin alone was before the merger.  This synergistic idea is the theoretical foundation for mergers in general and the main reason people use to argue for a higher price. You could also argue that by expressing an interest in Linkedin, Microsoft may be telling us something it knows about Linkedin's value that maybe we didn't realize before because we aren't as smart and informed as the people on Microsoft's board.  But since it's Microsoft that's doing the buying in this case, I'm going to go out on a limb and say this is not the main effect.  Given Microsoft's history, the idea that they buy expensive things because they have money to burn is more compelling than the idea that they have an insight into a company's value that we don't. For sure they are about to take a hit through winter. People in California either have solar, waiting for better technology (mostly cause by hype of Tesla home batteries) or hate it because of the looks. Then there are people who have shade / low electric bills and just aren't qualified.   I've had my whole division in solar (managers, everyone) be laid off in two different companies in two years, after getting promoted too :(. One filed for bankruptcy recently the other has been around awhile and might barely survive...another asked me for an interview...nah I can't take another lay off. "How many HVAC firms exist in your area?  If it's more than 1 or 2, it's unusual for them to be able to collude. If you feel underpaid, go interview.  You might find that you can get an offer for more $$$ elsewhere.  Don't reveal how much you currently make, if asked (this will distort the amount of the job offer).  At that point ask your current employer if they're willing to match.  If not, then move to the new company.    Some employees feel uncomfortable doing this.  You want to say, ""I like working here, but it doesn't make business sense for me to work for less than market rates.""  Also share your offer with your coworkers, at least the ones you like.  This will help equalize the market.  Employees can easily punish a stingy company with several departures." My point is that conflicts aren't the reason why Accenture split from AA. More money was to be had with a separate Accenture, thus the original split, thus the lawsuits, thus the IPO. This was mirrored by every other BigX except Deloitte (who almost spun off consulting in 2003 as Braxton but stopped it at the last minute due to a crappy market).  Accenture has a completely different structure than the big4. Public companies don't pay as much in salary and bonus. For example, an MD at Accenture makes 250k, a Partner at Big4 makes 600k. Do the math.   Also salaries are much higher at Big4 than Accenture (check out glassdoor). We do a lot of recruiting and Managers at Accenture typically come into big4 as Seniors at a higher salary.  In the general category of consulting Accenture competes, but there are tranches. Accenture is definitely below big4 in bill rates, salaries and prestige (as big4 is below Bain/BCG/McKinsey). This situation sounds better than most, the company it seems likely to be profitable in the future.  As such it is a good candidate to have a successful IPO.   With that your stock options are likely to be worth something.  How much of that is your share is likely to be very small.  The workers that have been their since the beginning, the venture capitalist, and the founders will make the majority of profits from an IPO or sale.  Since you and others hired at a similar time as you are assuming almost no risk it is fair that your share of the take is small.   Despite being 1/130 employees expect your share of the profits to be much smaller than .77%.  How about we go with .01%?   Lets also assume that they go public in 2.5 years and that revenues during that time continue to increase by about 25M/year.  Profit margins remains the same.  So revenues to 112M, profits to 22.5M. Typically the goal for business is to pay no more than 5 times profits, that could be supplanted by other factors, but let's assume that figure.  So about 112M from the IPO.  So .01% of that is about 11K.  That feels about right. Keep in mind there would be underwriting fees, and also I would discount that figure for things that could go wrong.  I'd be at about 5K. That would be my expected value figure, 5K.  I'd also understand that there is a very small likelihood that I receive that amount.  The value received is more likely to be zero, or enough to buy a Ferarri. There might also be some value in getting to know these people.  If this fails will their next venture be a success. In my own life, I went to work for a company that looked great on paper that just turned out to be a bust.  Great concept, horrible management, and within a couple of years of being hired, the company went bust.  I worked like a dog for nothing. "Absolutely terrible idea(s) on many fronts. Firstly, why are you giving away equity at all? usually it's to attract people you otherwise wouldn't be able to hire (like extremely talented coders or business development managers) but normal employees? Bad idea. If you really want to give up equity, then make sure it's only realized (valued) once certain targets are met (i.e. sales/revenue/share price/investment etc). As for the nomenclature, they're not ""Co-Founders"" - that's typically reserved for the people that foundned the company, not just people who happened to be working for the company it started trading. Call them ""founding employee"" if you must, but they're certainly not founders. Why does this matter? If the company ever takes iff or you get investment, or you fire one of them or one just gets the idea to sue you, their position name suddenly REALLY matters, and by not being careful, they could win a substantial cut of your company in a lawsuit. there's even stories of employees ganging up on their bosses and they end up owning the company. I know someone that's been involved in high 8 figure suit for 7 years for exactly the same reason. So unless they're putting in startup capital or they're taking a serious hit on their salary in return for compensation in the form of equity, don't give anyone equity."