5 ms·

As a point of curiosity, what's the usual rate of stock vesting for early employees at most small tech startups?

• joshu 16y ago
  4 years w/ one year cliff. Options, not stock.
  • aneesh 16y ago
    Is "options, not stock" mainly to get around the 500 shareholder rule? How is the strike price of the options typically determined?
    • gthank 16y ago
      It's also typically a huge win for the employees: at a pre-IPO company, your stock isn't really worth very much, because it's hard to find somebody to buy it (for most employees). So instead of paying taxes for a highly illiquid asset, you instead get an option (probably with a really nice strike price), and you don't pay taxes until you exercise it.
    • stefanobernardi 16y ago
      It's more for tax purposes. You actually don't own the stock yet so you're not paying taxes on it.