3 ms·
That's a fun tool (friendlyoptions). But I fear it may set false expectations, mainly because it bakes in assumptions about valuation growth and dilution per ro
by abalone 10y ago
That's a fun tool (friendlyoptions). But I fear it may set false expectations, mainly because it bakes in assumptions about valuation growth and dilution per round, namely ~3X and 30%. But those are actually hugely variable while having a profound effect on the outcome. And of course if you were to make those configurable it would be more accurate but explode the complexity of the tool... but that's exactly true to life.
If the goal is to gauge how a grant compares to competitive offers, I say we should focus on more objective, immediate metrics like percentage ownership. And some of the important terms you tool highlights, like exercise windows.
- birken 10y agoIt is a great point and I did struggle with it. I think if you want to be pessimistic about stock options you can just assume the value to be low or nothing. The site attempts to give you a cautious but optimistic view of what could happen if things go well. This was based on my own personal experience, experience of friends and openly available data on how the rounds normally go. My perspective when making the site is that companies will often be too optimistic about options even when the company does blow up, which leads people to be misled even if the company does do extraordinary well. The site gives a realistic view of what you can expect in an optimistic scenario. Of course very few companies every achieve this, but the idea is to at least gauge what your upside might be if a really lucky outcome happens. If I had good statistics about what % of companies reach Series A, then Series B, then Growth it would be great to put that on the site as well but I'm not sure where I can find that...