How To Negotiate Equity In A Private Company Or Startup

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Stock compensation is usually a big reason to work for a startup. Before signing an offer, consider these strategies to negotiate equity in a private company or startup.

) and hopefully in-the-money shares are exchanged for cash or you have public market liquidity to pay tax or sell shares to exercise.

If liquidity seems a long way off or if you don't anticipate staying with the company until that happens, consider asking for an extended period of time after separation from service to exercise options. Without it, you’ll only get 30 to 90 days. Also consider prioritizing cash compensation as the likelihood of benefiting from equity decreases.

Consider negotiating severance upfront, inclusive of a bonus target and accelerated vesting of optionsCompensation for forfeited stock, bonus, or other benefits in connection with accepting the new offer.

Negotiating equity in a private company is a key part to helping ensure a positive financial outcome. A lot of money can be made, lost or needlessly risked in pursuit of stock-based compensation. So be sure to make all your financial decisions on a realistic risk-adjusted basis. That said, the best opportunity you have to negotiate is during the initial offer. Don't let it pass you by!

 

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Maybe... - preferred equity at a small coupon accrued ( pic) - IRR negotiated - 80% of cash flow when it shows - waterfall down to 20% carried equity Not advice

Lotta blow?

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