Entrepreneur Urges Selling Vested Shares Immediately to Avoid Financial Losses

Raanan Cohen, an entrepreneur and author, strongly advises employees and founders to sell all their vested shares as soon as possible rather than waiting for higher valuations. Speaking on the podcast "The Psychology of Money," Cohen shared his personal experience of refusing to sell shares in his company MobileMax for about $10 million, hoping for a billion-dollar valuation. Instead, the company’s value plummeted due to market shifts, leaving him with no money, a mortgage, and four children. This painful lesson motivates his firm advice: "Sell everything vested, regardless of price, and reinvest elsewhere." He warns against the psychological trap of always waiting for "just a little more," which he calls a "demonic adaptation" that often leads to losing significant sums.

Cohen’s first company, MobileMax, was publicly traded on the Tel Aviv Stock Exchange in 2007 but collapsed after the smartphone revolution. After this failure, Cohen co-founded Bringg in 2013, a logistics tech company that reached a $1 billion valuation. This time, he sold shares early despite pressure to wait for a higher valuation, prioritizing financial security over potential upside. He highlights the risk of employees concentrating their income and equity in one company, urging diversification to reduce risk.

Financial planner Deborah Cohen offers a contrasting approach, recommending a gradual, strategic sale of shares over time to mitigate psychological stress and avoid regret. She emphasizes building a selling plan that spreads sales quarterly or annually, reducing emotional impact and tax risks. She argues that tax considerations are secondary to risk management and psychological comfort.

Cohen continues to support entrepreneurs through mentorship and has adapted his book into a screenplay. He stresses that no company, even giants like Nvidia or Google, lasts forever, so capturing gains early is crucial. His experience underscores the trauma and family impact of losing expected wealth, urging others to avoid his costly mistake by selling vested shares promptly.

Summary: Entrepreneur Raanan Cohen advises selling all vested shares immediately to avoid losses, sharing his own costly experience of waiting too long. Financial planner Deborah Cohen suggests a gradual sale strategy to reduce emotional and tax risks. Both emphasize managing risk and psychological factors over chasing maximum gains.