Hello, how is the distribution of RSU (stocks) done at Spotify? How is the stock price decided? I read that there is stock RSU for 4 years from the date of joining Spotify. Is the price of RSU for 4 years based on the price at start date? Note: i do not have an offer at Spotify but I'm just curious. #tech #faang #spotify
Spotify leans towards higher base pay and less on the equity compared to other tech companies. A typical package for senior right now in US is ~$225k base salary and ~$250k total “equity mix” that vests over 4 years. With the equity mix, you can choose either cash at 90% of total, RSU at 100%, 5 year options at 400% or 5 year out of the money options (current price + 50%) at 800%. It sounds complicated but it’s really just saying you choose your risk tolerance. The strike price is decided on a certain day of each month based on last month average at time of equity mix selection the month following your start date.
thank you for the reply. So, if I understand correctly, let's say a senior engineer gets 200k RSU over 4 years. The RSU would be allocated every month based on the price at the end of each month. I'm talking about allocation and not release of the RSU. Probably I'm mixing up the terminology. Allocate=Spotify gives you the RSU. Release=you can sell the RSU at any point from this moment.
Not quite. The strike price lock-in is a one-time activity. So that will translated to a number of shares roughly a month after you start. If you choose RSU for example, that $200k would translate to X shares all at once at that time. Over the course of next 4 years a percentage of shares will vest (release) on an interval I can’t remember if it’s monthly or quarterly.
You get to choose a bit if u want RSU/Options/Cash. Same amount. Some got lucky with options during covid. I would get cash atm.
Same amount? There is a multiplier for cash vs RSU vs in money options vs out of money options
Why cash atm? Seems like going higher risk when stocks are down >50% provides a good opp for higher risk plays to not be as high risk as they seem Especially given a 5 year time frame
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EDIT: Ignore my response below because I misread as Shopify 😂 The number of RSUs is calculated one or two months after you join, like in most companies. The vesting is in 3 years, with a 1 year cliff and then they vest every 3 months. That being said, there are plans for a compensation model revamp so this may change in the future.
Thanks. This is for Spotify (music streaming) and not for Shopify, right?
Oops, ignore my answer LOL