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You have to elaborate on this. So options you get are different from the options that can exit? 1st engineer typically get 1-3% of the company, and if there is

You have to elaborate on this. So options you get are different from the options that can exit? 1st engineer typically get 1-3% of the company, and if there is a clause that can prevent you from getting those shares on exit even though they were vested, joining a startup loses a lot of luster.

throwaway96 15y ago
It's common to get a job offer that says something like you get 10,000 options on shares. But you don't know if the company has 2M or 20M or however many shares; your percentage ownership could be 0.5% or 0.05%. If you're receiving an offer with shares or options, you should ask and be told what the total number of shares are (a cap table would be even better). I have not heard of cases where shares were vested then lost outright, except for perhaps Eduardo Saverin of Facebook. There are other (quite common) cases where the exit is not at a sufficiently high valuation compared to the most recent investment round and preferred shares cash out while common shares are reduced to little or no value.
- joshu 15y ago
  FYI the employer has to tell you what the shares outsanding is (or, I guess, what the % of the company the shares represent.)
enjo 15y ago
Possibly. Investors (generally) have some sort of liquidation preference on the stock. The details of that preference are complex and can take some time to fully understand. Things like double-dipping (owning a liquidation preference and THEN participating on the same percentage os a common stock holder) make it even more complex. The key thing to know is that not all stock is the same. "Owning" 1% of the company doesn't mean you get 1% of the exit necessarily. In smaller exits those liquidation preferences can mean that the investors are paid out and nothing is left of the pie for you. A good article on this: http://web.mit.edu/e-club/hadzima/what-are-the-terms-part1.html http://web.mit.edu/e-club/hadzima/what-are-the-terms-part1.h...

throwaway96 15y ago

It's common to get a job offer that says something like you get 10,000 options on shares. But you don't know if the company has 2M or 20M or however many shares; your percentage ownership could be 0.5% or 0.05%. If you're receiving an offer with shares or options, you should ask and be told what the total number of shares are (a cap table would be even better). I have not heard of cases where shares were vested then lost outright, except for perhaps Eduardo Saverin of Facebook. There are other (quite common) cases where the exit is not at a sufficiently high valuation compared to the most recent investment round and preferred shares cash out while common shares are reduced to little or no value.

joshu 15y ago
FYI the employer has to tell you what the shares outsanding is (or, I guess, what the % of the company the shares represent.)

enjo 15y ago

Possibly. Investors (generally) have some sort of liquidation preference on the stock. The details of that preference are complex and can take some time to fully understand. Things like double-dipping (owning a liquidation preference and THEN participating on the same percentage os a common stock holder) make it even more complex. The key thing to know is that not all stock is the same. "Owning" 1% of the company doesn't mean you get 1% of the exit necessarily. In smaller exits those liquidation preferences can mean that the investors are paid out and nothing is left of the pie for you. A good article on this: http://web.mit.edu/e-club/hadzima/what-are-the-terms-part1.html http://web.mit.edu/e-club/hadzima/what-are-the-terms-part1.h...