3 ms·

Could you explain more on what this means?

• forkerenok 6y ago
  Gladly! Non-recourse financing in this context means that in the event that shares (which are held as collateral) became worthless there is no personal recourse. I.e. your savings, house and whatnot are not on the hook. The contract is just dissolved. In this scenario you spend $0 of your own money on exercise. The "catch" is that you'll have to share the upside in case of a better outcome (according to pre-agreed rates). But the reality is that it's still a better option than just waiting for IPO/acquisition to exercise and sell shares at the same time (so called cashless exercise) [1]. [1] My colleague, Vieje, twitted a great case study on this topic: https://twitter.com/viejep/status/1306364614720909312 https://twitter.com/viejep/status/1306364614720909312