Not commenting on this particular situation, but to answer your question in general:

If a company has an IPO, there are no "employee retention payments", so it's better than that :)

Employee retention payments are actually a way to give employees a somewhat better deal than investors, though typically they will be subject to vesting.

> If a company has an IPO, there are no "employee retention payments", so it's better than that :)

The reverse split of common before preferred share conversions for IPO are often a big screw to the employees. Many are also unaware of it, as they don't dig through the S-1. (Atheros was the largest one I saw in this camp.)

Reverse split doesn't screw employees, it just changes the math (10000 shares at $1/share is no better than 1000 shares at $10/share).

> Reverse split doesn't screw employees

It absolutely screws the employees when the common is reverse split, but the preferred-to-common conversion factor remains the same.

That's not how it works.

> Is this typical? It would seem that the employees are getting the shorter end of the stick on this deal.

Which deals do you think they get the long end of the stick?

Talent acquisitions. Investors are often left with close to nothing.

True enough, but usually a talent acquisition means a failed product, which implies that the total stick length is pretty short anyway.