Pre-IPO employees: How do you plan to sell your shares after lockup to derisk?

Google
LowL5

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LowL5
Mar 10, 2021 12 Comments

Since stock prices can fluctuate a lot?
Also for minimizing capital gain tax?

#robinhood #roblox #affirm

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TOP 12 Comments
  • Affirm
    not_max

    Go to company page Affirm

    not_max
    Sell everything as soon as you can and diversify.
    Mar 10, 2021 7
    • Affirm
      not_max

      Go to company page Affirm

      not_max
      @google RSU are taxed as income at vest— in my case monthly. So the cap gain is based in after they vest monthly.

      @airbnb - correct but you have to factor in under withholding/ quarterly tax payments.
      Mar 10, 2021
    • Airbnb
      s45qnj

      Go to company page Airbnb

      s45qnj
      Yeah you have to. I am pretty bullish so i only sell to cover taxes.
      Mar 10, 2021
  • Airbnb
    nextapple

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    nextapple
    If the stock hadn't 3x'd from what we thought it was going to IPO at I might have held, but decided to sell max in each open trading window. Going to plan to hold the rest until LTCG though. I keep swinging wildly between being super bullish on Airbnb after we hit herd immunity to being really skeptical about the valuation. Ultimately decided to be more conservative and cash out.
    Mar 10, 2021 3
    • Airbnb
      nextapple

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      nextapple
      Honestly don't know the full deets 100% because I outsourced to a financial planner and a tax consultant but basically the gist was something like % of the increase between when I vested and when I sold. And that % is significantly lower once you hit the one year mark of vesting. If I was a little more risk tolerant I would hold because I think the delta between STCG and LTCG is about 10-15% depending on your tax bracket (again, I'm not in the deets because I pay someone not to have to think about it).
      Mar 10, 2021
    • Google
      LowL5

      Go to company page Google

      LowL5
      OP
      Yeah I guess I understand the STCG vs LTCG. But I’m more curious about for LTCG will the gain amount severely impact the total tax you have to pay.

      So was thinking selling all VS some in the first year right after lockup might make a big difference.
      Mar 10, 2021