I received a offer from a startup which has a 70% chance to go IPO ( timing horizon 1-2 years ) As a part of the offer they are giving 3100 options valued over a million While I am going to renegotiate the offer , what questions do you ask about the valuation of company / dilution / strike price to understand the value of the stock ( understand it’s paper money and no guarantee of IPO ) Offer details - 220/20%/3100 options ( not comfortable sharing name of startup ) My current TC - 280 Any thoughts on how to negotiate higher specially the options ?
70% chance? lol that made my saturday and it’s only 8am
What can I say .... I do provide such weekend services :)
What is the strike price? this is the price you pay to the company when you want to buy the stocks from them. What is the enterprise price or FMV (fair market value)? If they won't give you these two numbers, run away!!!
so hard to say anything with so little information. probably the company worth $10bn but then it doesn’t make sense you’d get options. so i’ll guess $1bn and they are series D and not going public soon . that makes your share .1%. that can’t be. must be $10bn. so at that valuation i would assume 20%-50% growth of the preferred price. so then subtract out your strike price. but options don’t make sense at this price. so need more info. the safe answer is the options are worth $0. 70% ~= 0%
does this startup have verifiable secondary market prices ? dont rely solely on company provided valuation estimates..