Startup Stock Options

Hey, some startup stock options end up being worth something. :)

They probably have stock options.

I worked at a startup for 2 years (left without exercising my options). I objected to options right from the start and during negotiations with the CEO said they should max out my salary in lieu of options. Options are funny money to trick potential employees into thinking their lower salary will pay-out in the end. But the reality is most start-ups do not have exits where rank and file employees get anything for their stock. Investors get paid first, then founders, followed by employees if anyt

In my experience most people at startups who leave end up not exercising their options due to the cost of exercising them coupled with the fact that they may be underpaid due to the assumption that their options may end up quite valuable. So basically they pay somebody 90k/year then give them ~20k/year in options. Then they quit after 2 years and have 90 days to buy like 50k worth of stock at the strike price they were promised.So they end up paying 50k to buy some common shares (no

Employee options have a 10 year limit, and given the age of the company some employees were going to lose their options if they don't exercise. But to exercise you need to pay, in cash, the strike price plus taxes. I believe this founding round is to cover this.

Option piece is misleading.You own 1% of options and company is bought for $10m.Your payoff?Likely $0.He forgot to mention preferred shares given to VC’s with liquidation preferences that likely never disclosed to new engineers.This is what makes new engineer to sacrifice his salary for a possible liquidation even that likely either never happens or there is no money left for him after VCs took their xN ratios off the payoff.

most startups don't offer actual equity even though that's what everyone calls it. they offer options. the idea is that the options you'll receive will have a strike price much lower than what the stock will be worth in future funding rounds or when the company is acquired or IPOs. the vesting schedule defines when you can start to exercise those. typically you'll receive 25% of your options after the first year, then the other 75% will vest every month after.and yes, liqu

Don't feel bad. The issue here is the relationship with the company & Carta and overall corporate concerns, not much about employee equity.Briefly:- In a startup you're granted options. Contract that allows you to buy certain amount of company shares at a specific price (”strike price”, also known as “exercise price”), which is usually the fair market price at the time when your options are granted. Options do not give you ownership of stock, instead they provide you rights t

What they likely meant was that the options would eventually be worth $5m, but not when they left the company and could exercise them.

Most startup options amount to nothing. What happened to you is reprehensible, but be careful to ensure you don't spend more money pursuing this than you're likely to gain.Remember that options are just the privilege to exchange real money that has value now for restricted private stock you can't easily sell and will very likely be worthless. Obviously you know more about the company having worked there - just be careful indignation and a sense of justice don't prevent you