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The best advice I've seen is to value stock options at zero. Most startups fail. There can also be huge dilution and other risks. At the end of the day, it come
by tachyonbeam 6y ago
The best advice I've seen is to value stock options at zero. Most startups fail. There can also be huge dilution and other risks. At the end of the day, it comes down, as you're saying, to whether you enjoy working there or not, and whether or not the base salary is enough to make it worthwhile.
- skeeter2020 6y agoThis is true of all variable compensation components, regardless of being stock options, profit sharing or discretionary bonuses. You need to weight it by risk, which typically means zero real value and potentially a nice surprise.
- chris11 6y ago> The best advice I've seen is to value stock options at zero. I don't know. I understand that, but on the flip side I got lucky and currently my equity is worth money. In SV equity can make up a large portion of your compensation, it shouldn't be ignored. Sure, generally equity from a public company is worth more money. But equity at startups can still be valuable. A better conservative approach to startup equity would be to negotiate first for a good base salary and then negotiate for equity. VC-funded startups can pay well.
- vinger 6y agoCan you extract actual money from your equity or is it locked in until some future event happens? Private stock can be internally valued highly but the hard part is extracting the value. Before going public so many events can legally occur to reduce the value of your shares. Don't count your chickens before they have hatched.