# Employee liquidity can strengthen AI recruiting

Markdown copy of https://realalpha.app/s/employee-liquidity-can-strengthen-ai-recruiting/ on Real Alpha, the best minutes from long interviews with the people building AI. Cite and link the page, not this copy.

- Speaker: [Erik Bernhardsson](https://realalpha.app/builders/erik-bernhardsson/) · Erik Bernhardsson is co-founder and CEO of Modal. · Co-founded Modal, the high-performance cloud for AI teams; previously led Spotify's music recommendation and data infrastructure teams.
- Host: [Harry Stebbings](https://realalpha.app/people/harry-stebbings/) · Founder, 20VC · Built a venture firm on his podcast; its third fund closed at $400M.
- Show: 20VC
- Episode: [Modal CEO: Has Open-Source LLM Inference Peaked? | What Happens to the Cost of Compute](https://realalpha.app/v/1dwyL6Iz_PU/), Nov 2, 2026
- Moment: 52:00 to 54:50 of the episode (3 min), playing on https://realalpha.app/s/employee-liquidity-can-strengthen-ai-recruiting/; the episode from there: https://realalpha.app/v/1dwyL6Iz_PU/?t=3120

## Quote

> “But I think it's a way to create a **very liquid, hard currency** out of the equity.”
> — [Erik Bernhardsson](https://realalpha.app/builders/erik-bernhardsson/) at [52:47](https://realalpha.app/v/1dwyL6Iz_PU/?t=3167) · 20VC

## Takeaways

1. He cites employee sales of up to 10% as one possible guardrail.
2. Keep enough employee equity invested to preserve incentives.
3. Liquidity helps make offers more competitive with AI labs.

## About this segment

Erik Bernhardsson argues that capped employee secondaries make equity feel tangible while preserving incentives. That liquidity helps Modal compete with AI labs offering exceptional new grads $20 million or more.

From “Modal CEO: Has Open-Source LLM Inference Peaked? | What Happens to the Cost of Compute”, Nov 2, 2026. [Watch the full episode](https://realalpha.app/v/1dwyL6Iz_PU/)

## Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

[52:13](https://realalpha.app/v/1dwyL6Iz_PU/?t=3133) I'm okay with that because I think the long-term opportunity is so fucking big. It's so large. Do you take secondaries? Very little. Why? I mean, I personally don't need a lot of money. I'm pretty happy with life and I have enough. So personally, I actually support it for my employees though. It's quite important, actually, as a founder, that you make the equity worth as much as possible. And one of the ways to do that and to tell future candidates that, no, this isn't just paper money.

[52:40](https://realalpha.app/v/1dwyL6Iz_PU/?t=3160) This is real money, is to have a precedent of doing employee secondaries. And you can point to last round, we let employees sell this much or whatever, and up to 10%. I think you have to have guardrails. You don't want employees to sell too much. You want them to still have a lot of skin in the game and be very incentivized to make the company successful. But I think it's a way to create a very liquid, hard currency out of the equity.

[53:04](https://realalpha.app/v/1dwyL6Iz_PU/?t=3184) I totally agree. And as you think about a talent marketplace that's ever more competitive, it's very- It's extremely competitive out there. Is it nuts? It's nuts. It's nuts. I mean, the offers we see for, we've lost new grads going to some of the labs for talking 20 plus million. I mean, these are exceptional people. Exceptional. What makes an exceptional, exceptional new grad? You know, like just fucking sharp people.

[53:31](https://realalpha.app/v/1dwyL6Iz_PU/?t=3211) You know, these are like, I know it when I see it. Like they're just, you know, they're just extremely hungry, hardworking. And where do they go? They know everything about technology. I mean, they go to some of the big labs. Is that it? They go to Open Air and Anthropoc? Yeah, the big labs. They pay a lot. But is that it? Is that where the talent comes? There's like a few other ones. But I mean, mainly those people are known for paying very, a lot of money.

[53:51](https://realalpha.app/v/1dwyL6Iz_PU/?t=3231) And you won't pay that much? We pay a lot. We can go very aggressive. We want to be out there paying 95th percentile in the market. And there's a few companies that I know, they're probably going to pay a little bit more. I think we have way more upside in the equity. And going back to what I said about secondaries, I think it's important that for that reason also to create a real tangible value in the currency, in the equity that makes us, our offers seem very, very strong.

[54:14](https://realalpha.app/v/1dwyL6Iz_PU/?t=3254) Plus the fact that we have a lot of upside. I mean, you said it, right? Like our stock seems cheap. Like I kind of agree, there's a lot of upside in our stock. so that enables us to not necessarily have to match with the labs but i think you know create a compelling sales pitch for why our comp package is like basically better than the labs and we're willing to go very far to get the best talent okay we're gonna do a quick fire round because otherwise i could talk to you all day you have a great angel portfolio open router you mentioned