Former Uber employees have gone into debt to exercise options they can’t sell

Re:Former Uber employees have gone into debt to exercise opt... by sockgrant on Tuesday December 12, 2017 @12:22PM (#15907386)

Yeah they always assign a dollar amount to options instead of a % amount which is what really matters.

$100,000 in options sounds great but if it’s .01% of options then you’ll have to be part of a monster IPO or sale to get a windfall.

Always insist on the % amount. Most founders will try not to share it.

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Re:Former Uber employees have gone into debt to exercise opt... by hkmurakami on Tuesday December 12, 2017 @12:44PM (#15907643)

If you have the dollar amount and the # of shares, then you can backtrack it to a rough percentage.

Also options are a % increase in share price play, so $100,000 strike price can at least give you some information wrt how much $ you can make if the per share price of the company triples, etc.

It's not always better to know % and % only. Let's say you get 1% options of a company valued at $10B. Options are priced at the preferred price, no discount. The company IPOs at $10B. Did you make $100M? Nope you made $0 so far!

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Re:Former Uber employees have gone into debt to exercise opt... by timr on Tuesday December 12, 2017 @01:14PM (#15907942)

"If you have the dollar amount and the # of shares, then you can backtrack it to a rough percentage."

Perhaps. But if a company will not give you a percentage of ownership and expects you to accept this as compensation, you should quit. Full stop.

If the company won't tell you how to fairly evaluate your options, they're operating in bad faith, and should not be rewarded for their sleazy behavior.

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Re:Former Uber employees have gone into debt to exercise opt... by hkmurakami on Tuesday December 12, 2017 @01:27PM (#15908069)

I agree with you on that regard fwiw. I've wondered whether a company will tell me what the liquidation preferences and antidilution clauses for its preferred shares are, since that also comes into play pretty significantly wrt evaluating the value of ones equity offer.

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Re:Former Uber employees have gone into debt to exercise opt... by timr on Friday December 22, 2017 @01:33PM (#15989720)

This gets into a fuzzy area, since it's a multidimensional equation, and often, even the founders can't tell you what your share is "worth" without lots of caveats and time spent on spreadsheets. There's usually not a single answer.

The important principle, though, is that they shouldn't be hiding anything from you. If the company won't even tell you the percentage your shares represent, you can't trust them to do anything else.

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