Vested RSUs after leaving a pre-IPO company

Airbnb dfveksbd
Mar 23 22 Comments

At Airbnb, once an RSU vests, it’s yours to keep until the company goes public in which case you’re able to sell it. Airbnb does not take back my vested RSUs but I do forfeit the unvested RSUs when I leave.

I’ve explained this concept to several FANG engineers and people from other public companies who seem confused and surprised that vested RSUs remain ours even after leaving a pre-IPO company.

Is this not the case with other companies? Do other private companies take back your vested RSUs after you leave?

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TOP 22 Comments
  • Broadcom Ltd. rFkd21
    This is the case at literally every other company.
    Mar 23 1
  • BlackRock EwAS46
    Perhaps they confused them with ISOs, which often do require you to either exercise or lose them after you leave the company (typically within 90 days), even after they’ve vested.
    Mar 23 1
    • Airbnb dfveksbd
      OP
      Ahhh. You’re likely correct. Thanks for calling this out.
      Mar 23
  • Houzz str0ng🐨
    Hmm I think your experience is the normal one, no?
    Mar 23 1
    • Airbnb dfveksbd
      OP
      Absolutely. I thought it was common knowledge until I spoke to these people and then ran into this response from a blind post which made me wonder if pre IPO companies did not have this policy as standard:
      Mar 23
  • New VkGD57
    Doesn’t it depend whether your RSUs are single trigger (ie time employed) or double trigger (ie time employed AND liquidity event)?
    Mar 23 0
  • Apple
    tilt okay

    Apple

    PRE
    Amazon
    tilt okay more
    @op with whom you have been talking to ? Those must be smoking weeds...
    Mar 23 0
  • Booking.com / Eng whatsgo
    All private companies who offer RSUs also have an exercise window (I don't remember the exact term). It means that you can keep your RSUs for x number of years after you leave the company. If there's no exit for the company within that time period, you lose your RSUs. Maybe Airbnb offers a long enough such time period.
    Mar 23 5
    • BlackRock EwAS46
      You’re talking about ISOs, not RSUs. Only ISOs need to be exercised in order to convert the options into stock. RSUs are already equivalent to stock, and do not need to be exercised.
      Mar 23
    • Booking.com / Eng whatsgo
      No. I'm talking about RSUs and I know how they differ from ISOs. I used the wrong term (exercise window).

      I have had some offers from private companies which offered RSUs and there was a term in contract that I can keep my vested RSUs after my departure from the company for x years or until the liquidity event whichever happens first.
      Mar 23
    • Houzz cuteAlien
      booking guy is correct. You could lose your RSUs if your company didn’t go IPO in X years
      Mar 23
    • Apple Lanagens
      Yes I think all RSU’s for pre ipo companies expire in 7 years. I believe it’s a IRS rule.. also this is applicable to everyone, even present employees.
      Mar 24
    • Houzz cuteAlien
      Good reminder that my paper money has an expiration date.
      Mar 24
  • Apple / Eng gtUh6$
    Most FANG engineers have never worked at a pre IPO company, that’s why
    Mar 23 0
  • Spotify / Eng qbeforeu
    Do you get to keep the cash money they pay you too when you leave?
    Mar 23 0
  • Amazon gyqhjb
    Once an RSU vests, it’s yours. All FANGs operate this way. Maybe your friends confused vest with grant?
    Mar 23 0
  • Drive.ai fds
    When companies give you ISOs you often lose them a few months after leaving unless you exercise them. The are some exceptions, though.
    Mar 23 2
    • Airbnb dfveksbd
      OP
      Yep. I think the people I spoke to mixed up RSUs with ISOs. They’re not the same thing and have different rules
      Mar 24
    • Drive.ai fds
      Your shares can always be diluted, though, which in some cases can make them worthless.
      Mar 24
  • Yes you keep the vested RSU. But, I could be wrong on this, but that RSU is terminated if after N years the company doesn’t go IPO.
    Mar 23 1