It’s a piece of the puzzle though. Consider you’ll be at the startup for 8 years before moving on, letting all your ISO’s vest after the IPO. In that time, the

It’s a piece of the puzzle though. Consider you’ll be at the startup for 8 years before moving on, letting all your ISO’s vest after the IPO. In that time, the current company would have matched ~200k in funds when accounting for yearly appreciation of 8% in it. And of course the marginal tax savings you’ll have from a higher a salary over that time. So you add that to the formula plus assumed salary differences in that time and whatever income you’ll receive from RSU’s and the increase in the current company’s market cap over the time. You may even consider what your current salary allows you to invest after taxes and how that will compound and if the startups lower salary will still allow that or if you’d have to pause that. So add that all up and that is what you’re discounting. In essence the ISO’s from the startup need to at least equal that after 8 years (or however many you are assuming until exit. 8 is average) to break even. It’s possibly in the many millions for some people. It’s a hard calculation with a lot of variables and assumptions. But it’s helpful to see how much of a risk you may really be taking.