Valuing startup stock options

Valuing startup stock options

Posted: Forever666 Date of post: 14.07.2017

You just received a job offer from your favorite early-stage startup. Now comes the tricky part — figuring out what your compensation package really means.

Accepting a new job offer is an incredibly personal decision, and compensation is only one factor.

Since startup compensation can be particularly confusing, we wanted to share a tool we built at Front to help candidates make informed decisions. Your typical startup compensation package consists of a combination of salary and equity. On top of that, startups are inherently risky.

The value of equity is neither certain nor fixed. The difference between the worst case and best case scenarios can be huge. At a minimum, employees need the number of shares already issued i.

Once you have the number of fully diluted shares, the percentage of the company that the employee could own is fairly easy to calculate. IPO or acquisition and your particular offer numbers.

However, some dilution should be accounted for, as it is likely that additional shares will be issued in the future to new investors. All of this is easy to say, but a little less easy to do. After getting frequent equity questions from candidates, we decided to build an equity calculator to help them understand their offers with Front. Edit the fields to add your own offer numbers and company information i.

You can also play with the dilution and exit values to get a better understanding of how various scenarios would affect the value of your package. Last week, we launched Front after 7 months of beta. To make it really official, we managed to be featured.

There's no doubt that SaaS companies must build their strategy around their customers. I originally published this post on thinkgrowth.

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In the early days of a startup, the only thing that matters. Try free for 14 days. Customer Service Productivity Email Collaboration Startups Innovative Companies Transparency. How to Value your Compensation: Startup compensation basics Your typical startup compensation package consists of a combination of salary and equity.

How to value your startup stock options | Robert Heaton

Startup Equity Calculator All of this is easy to say, but a little less easy to do. Gwen Waichman Recruiter at Front. You might also like How to Choose between Hacker News, TechCrunch and Product Hunt?

valuing startup stock options

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valuing startup stock options

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