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                                                                 EXHIBIT 10.12

                              EMPLOYMENT AGREEMENT


         This Employment Agreement (the "AGREEMENT") is entered into effective
as of March 22, 1999, between Wit Capital Group, Inc., a Delaware corporation
(the "CORPORATION"), and Lloyd H. Feller (the "EXECUTIVE").

                              W I T N E S S E T H:
                              -------------------

         The Corporation desires to employ the Executive to have the benefits of
his expertise and knowledge. The Executive, in turn, desires employment with the
Corporation. The parties, therefore, enter into this Agreement to establish the
terms and conditions of the Executive's employment with the Corporation.

         In consideration of the mutual covenants and representations contained
in this Agreement, the Corporation and the Executive agree as follows:

         1.       EMPLOYMENT OF EXECUTIVE; DUTIES.

                  (a) The Corporation agrees to employ the Executive, and the
Executive agrees to be employed by the Corporation, as Co-General Counsel and
Senior Vice President for the period specified in Section 2 (the "EMPLOYMENT
PERIOD"), subject to the terms and conditions of this Agreement. During the
Employment Period, the Executive shall have such duties and responsibilities
generally consistent with his position and such other duties not inconsistent
with his title and position as may be properly assigned to him by the
Corporation.

                  (b) The Executive shall report directly to Ronald W. Readmond,
Co-Chief Executive Officer. Any change in the reporting procedure shall require
the consent of the Executive, which consent shall not be unreasonably withheld.

         2.       EMPLOYMENT PERIOD. The Employment Period shall begin on
April 15, 1999 and shall continue for three (3) years.

         3.       BASE SALARY. During the Employment Period, the Corporation
shall pay the Executive a minimum annual base salary of Two Hundred Forty
Thousand Dollars ($240,000). The base salary shall be payable in equal
periodic installments which are not less frequent than the periodic
installments in effect for salaries of other senior executives of the
Corporation. The base salary shall be subject to annual review by the Board
of Directors ("BOARD") (or a committee appointed by the Board) for upward
adjustments based on the policies of the Corporation and the Executive's
contributions to the business of the Corporation.

         4.       ANNUAL BONUS PLAN, LONG-TERM INCENTIVE PLAN AND OTHER
BONUS. During the Employment Period, the Executive shall be entitled to
participation at the senior executive level in both the Annual Bonus Plan for
Executives and the Long-Term Incentive Plan. In addition, during the
Employment Period, the Executive also shall be entitled to guaranteed annual
bonuses as follows: (i) Four Hundred Eighty Thousand Dollars ($480,000) for
the first year of employment; and (ii) Seven Hundred Twenty Thousand Dollars
($720,000) for each of the second and third years of employment ("GUARANTEED
BONUS"). The Guaranteed Bonus shall be paid to the Executive on a semi-annual
basis with the first payment due six (6) months from the effective date of
this Agreement.

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         5.       BENEFITS.

                  (a) In addition to and except for the matters governed by this
Agreement, the Executive shall be entitled to employee benefits and perquisites,
including but not limited to pension, deferred compensation plans, stock
options, group life insurance, disability, sickness and accident insurance and
health benefits under such plans and programs as provided to other senior
executives of the Corporation from time to time.

                  (b) The Executive shall be provided, at the Corporation's
expense, an office and support staff either, in the Corporation's sole
discretion, at the Corporation's offices in New York City or at offices to be
located in Washington, D.C. In the event that the Executive is required to work
at the Corporation's New York City offices, the Corporation shall pay the
Executive's reasonable relocation expenses associated therewith.

                  (c) The Executive shall be entitled to four (4) weeks paid
vacation as well as holidays, leave of absence and leave for illness and
temporary disability in accordance with the policies of the Corporation.

         6.       STOCK PURCHASE.

                  The Executive shall have the right to purchase Six Hundred
Fifty Thousand (650,000) shares of the Common Stock of the Corporation in
accordance with the Stock Purchase Agreement attached hereto as Exhibit I.

         7.       STOCK OPTIONS.

                  The Executive shall have the option to purchase Two Hundred
Thousand (200,000) shares of the Corporation's Common Stock at One Dollar and
Fifty Cents ($1.50) per share. Such options shall vest incrementally as follows:
Twelve Thousand Five Hundred (12,500) Shares on June 30, 1999 and Twelve
Thousand Five Hundred (12,500) Shares on the last day of September, December,
March and June thereafter until March 31, 2003 at which time the entire Two
Hundred Thousand (200,000) Shares will have become fully vested; provided,
however, that vesting shall accrue only if the Executive is employed with the
Corporation on the specified vesting date or as otherwise specified in the stock
option grant agreement. Such options shall be Incentive Stock Options to the
degree permitted under law and shall be subject to all the terms and conditions
of the option plan under which they are granted.

         8.       NON-DISCLOSURE; NON-COMPETITION.

                  As a condition to the employment arrangement, Executive agrees
to execute and comply with the terms and conditions of the "Wit Capital Group,
Inc. Employee Non-Disclosure, Non-Competition and Assignment of Inventions
Agreement" attached hereto as Exhibit II.

         9.       TERMINATION.

         9.1      TERMINATION BY THE CORPORATION.

                  (a) The Corporation, by action of its Board, may terminate the
Executive's employment under this Agreement without Cause (as defined in Section
9.1(b)), at any time by giving notice thereof to the Executive at least ninety
(90) days before the effective date of

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such termination. The Employment Period shall terminate as of the date of such
termination of employment.

                  (b) The Corporation, by action of its Board, may terminate the
Executive's employment under this Agreement for Cause at any time by notifying
the Executive of such termination. For all purposes of this Agreement, the
Employment Period shall end as of the date of such termination of employment.
"CAUSE" means the Executive's: (i) persistent and repeated refusal, failure or
neglect to perform the material duties of his employment under this Agreement
(other by reason of the Executive's physical or mental illness or impairment),
provided that such Cause shall be deemed to occur only after the Corporation
gave notice thereof to the Executive specifying in reasonable detail the conduct
constituting Cause, and the Executive failed to cure and correct his conduct
within thirty (30) days after such notice; (ii) committing any act of fraud or
embezzlement, provided that such Cause shall be deemed to occur only after the
Corporation gave notice thereof to the Executive specifying in reasonable detail
the instances of such conduct, and the Executive had the opportunity to be heard
at a meeting of the Board; (iii) breach of the Employee Non-Disclosure,
Non-Competition and Assignment of Inventions Agreement or of such other
subsequent agreements entered into during the Employment Period that results in
a material detriment to the Corporation; (iv) conviction of a felony (including
pleading guilty to a felony); or (v) habitual abuse of alcohol or drugs.

         9.2      TERMINATION BY THE EXECUTIVE. The Executive may terminate this
Agreement at any time, for any reason or for no reason at all, by giving notice
thereof to the Corporation at least ninety (90) days before the effective date
of such termination. The Employment Period shall terminate as of the date of
such termination of employment.

         9.3      SEVERANCE BENEFITS.

                  (a) If the Executive's employment under this Agreement is
terminated before the end of the Employment Period by the Corporation without
Cause or by the Executive for Good Reason (as defined in Section 9.3(c)), the
Corporation shall pay the Executive a lump sum cash payment, within thirty (30)
days of the date of such termination, equal to the sum of: (i) the aggregate
amount of the Executive's unpaid Base Salary, payable at the annual rate in
effect on the termination date, through the end of the three (3) year Employment
Period; (ii) an amount representing the Executive's unpaid Annual Bonus amounts
accrued through the date of termination; and (iii) an amount representing the
Executive's unpaid Guaranteed Bonus prorated through date of termination plus
fifty percent (50%) of the aggregate amount of the Executive's unpaid Guaranteed
Bonus for the period commencing with the date of termination through the end of
the three (3) year Employment Period. Additionally, COBRA benefits shall be
provided at the expense of the Corporation commencing as of the date of
termination and continuing for the applicable statutory period, but in no event
to exceed an eighteen (18) month period.

                  (b) If the Executive's employment under this Agreement is
terminated by the Corporation for Cause, by the Executive without Good Reason or
if the Executive dies or becomes totally disabled (as defined in Section 9.4),
the Corporation shall only pay the Executive a lump sum cash payment within
thirty (30) days of the date of such termination, equal to the sum of: (i)
Executive's unpaid Base Salary earned to the termination date; (ii) an amount
representing the Executive's unpaid Annual Bonus amounts accrued through the
date of termination; and (iii) an amount representing the Executive's unpaid
Guaranteed Bonus prorated to date of termination.

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                  (c) "GOOD REASON" means: (i) any material reduction in the
Executive's authority, duties or responsibilities; (ii) any material change in
the Executive's reporting lines or removal of the Executive from his principal
positions as of the beginning of the Employment Period (other than a promotion);
or (iii) any material failure by the Corporation to pay or provide the
compensation and benefits under this Agreement; provided that, in each such
event, the Executive shall give the Corporation notice thereof which shall
specify in reasonable detail the circumstances constituting Good Reason, and
there shall be no Good Reason with respect to any such circumstances cured by
the Corporation within thirty (30) days after such notice.

                  (d) If the Executive is entitled to receive payments or other
benefits under this Agreement upon the termination of his employment with the
Corporation, the Executive hereby irrevocably waives the right to receive any
payments or other benefits under any other severance or similar plan maintained
by the Corporation ("OTHER SEVERANCE PLAN"), provided, however, that if the
payments and other benefits provided under such Other Severance Plan exceed the
payments and other benefits under this Agreement, the Executive, in his sole
discretion, may elect to receive the payments and benefits under such Other
Severance Plan in lieu of the payments and benefits under this Agreement upon
his termination of employment.

         9.4      TERMINATION BY DEATH OR DISABILITY. This Agreement shall
terminate automatically upon the Executive's death. If the Corporation
determines in good faith that the Executive has a "total disability" (within the
meaning of such term or of a similar term as defined in the Corporation's
long-term disability plan as in effect from time to time), the Corporation may
terminate his employment under this Agreement by notifying the Executive thereof
at least thirty (30) days before the effective date of such termination.

         10.      NOTICES. Any notices, requests, demands and other
communications provided for by this Agreement shall be sufficient if in writing
and if sent by registered or certified mail to the Executive at the last address
he has filed in writing with the Corporation or, in the case of the Corporation,
to the Corporation's principal executive offices.

         11.      WITHHOLDING TAXES. The Corporation shall have the right, to
the extent permitted by law, to withhold from any payment of any kind due to the
Executive under this Agreement to satisfy the tax withholding obligations of the
Corporation under applicable law.

         12.      BINDING AGREEMENT. This Agreement shall be binding upon the
Executive and the Corporation on and after the date of this Agreement. The
rights and obligations of the Corporation under this agreement shall inure to
the benefit of and shall be binding upon the Corporation and any successor of
the Corporation, and the benefits of this Agreement shall inure to the benefit
of the Executive's estate and beneficiaries in the event of the Executive's
death. The Corporation may assign this Agreement to any subsidiary, parent or
affiliate, without the consent of the Executive, and such assignment shall not,
in and of itself, constitute, a termination of employment under this Agreement.

         13.      ENTIRE AGREEMENT. This Agreement constitutes the entire
understanding of the Executive and the Corporation with respect to the subject
matter hereof and supersedes and voids any and all prior agreements or
understandings, written or oral, regarding the subject matter hereof. This
Agreement may not be changed, modified, or discharged orally, but only by an
instrument in writing signed by the parties.

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         14.      GOVERNING LAW AND SEVERABILITY. This Agreement shall be
governed by the laws of the State of New York (without giving effect to choice
of law principles or rules thereof that would cause the application of the laws
of any jurisdiction other than the State of New York) and the invalidity or
unenforceability of any provisions hereof shall in no way affect the validity or
enforceability of any other provision. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating or affecting the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

         15.      ARBITRATION. disputes regarding the Executive's employment
with the Corporation, including, without limitation, any dispute UNDER THIS
AGREEMENT which cannot be resolved by negotiations between the Corporation and
the Executive, but excluding any disputes regarding the executive's compliance
with the restrictions of THE EMPLOYEE NON-DISCLOSURE, NON-COMPETITION AND
ASSIGNMENT OF INVENTIONS AGREEMENT REFERRED TO IN SECTION 8 of this agreement,
shall be submitted to, and solely determined by, final and binding arbitration
conducted by Jams/Endispute, Inc.'s arbitration rules applicable to employment
disputes, and the parties agree to be bound by the final award of the arbitrator
in any such proceeding. The arbitrator shall apply the laws of the State of New
York with respect to the interpretation or enforcement of any matter relating to
this Agreement; in all other cases the arbitrator shall apply the laws of the
state specified in THE CORPORATION's alternative dispute resolution policy as in
effect from time to time (if any). Arbitration may be held in New York, New
York, or such other place as the parties hereto may mutually agree, and shall be
conducted solely by a former judge. Judgment upon the award by the arbitrator
may be entered in any court having jurisdiction thereof.

         IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.

WITNESS/ATTEST                           WIT CAPITAL GROUP, INC.


                                         By: /s/ Ronald Readmond
                                            -----------------------------
                                               Ronald W. Readmond,
                                               Co-Chief Executive Officer


                                         EXECUTIVE

                                          /s/ Lloyd H. Feller
                                         -----------------------------
                                         Lloyd H. Feller