Confluent RSU vs Stock options

Amazon
yyJq13

Go to company page Amazon

yyJq13
May 28, 2021 34 Comments

Asking for a friend (YOE: 0). Confluent has given two options:
1. 5050 RSUs with 4 year vesting
2. 10100 stock options with 4 year vesting

Which one should be preferred?

213 PARTICIPANTS SELECT ONLY ONE ANSWER
VOTE VIEW RESULT

comments

Want to comment? LOG IN or SIGN UP
TOP 34 Comments
  • Adyen
    flikkerop

    Go to company page Adyen

    flikkerop
    Most imp info missing- Grant price for the options? Basically you have to make a guess if after IPO what price each of those options will be at and how much ull net after taking the grant price out.

    The fact that they are offering both... signals to me that they are less confident of a home run with IPO. Cos why not just give everybody RSUs and if they are confident of the upside engineers will flock and those hired will stay longer.

    With options, the burden of decision is being put on the employee who has no access to the information the board has.

    In this case... since the no of options is 2x... the diff between the expected share price at IPO and the grant price will have to be at least half of the total value of the share for u to make the same money as RSUs.

    eg. IPO price- $10. Grant price $5.
    Money with options (10-5) * 10100 = 50500
    Money with RSUs also $10 * 5050 = also 50500

    So if the grant price was less than half say $3 then u would be better off with options.

    If the strike price is say $7 for the same case... u only make $30300 with options but would have made ~$35k with RSUs

    Obviously what the IPO price will be is a guessing game.
    May 28, 2021 4
    • Amazon
      yyJq13

      Go to company page Amazon

      yyJq13
      OP
      25 $ is the strike price and offer was generated 6 months back
      May 29, 2021
    • I am going to call BS on the strike price. As another poster said, the price is set by board in the board meeting after you join. The recruiter cannot set a price but might be able to give you the price that's expected to be set if you join by a certain date. From what I hear, only RSUs are being offered currently, but since this was a 6 month old offer they might be trying to replace the options with RSUs. Just value the RSUs and options and pick whichever is higher. Likely they are at same value so it shouldn't matter.
      May 31, 2021
  • New
    fdsN05

    New

    fdsN05
    Just saw the numbers for Confluent , what do you guys think of 77 Mil Rev for Q1 2021, do you think it will cross 15 Bil Valuation ?
    Jun 1, 2021 3
    • New
      hsjk

      New

      hsjk
      Recently (2-3 months back) changed a lot of branding to "Data in Motion" not sure what to make of it. Can be a positive thing if able to accomplish what they are planning to do rn
      Jun 2, 2021
    • New
      mxq7rpi

      New

      mxq7rpi
      Well, here we are at $18 billion.
      Jan 4
  • Totally depends on the strike price of the options. If strike price < 50% of the stock price, then go for options
    May 28, 2021 0
  • Location?
    May 29, 2021 3
  • Google
    itdhkxkh

    Go to company page Google

    itdhkxkh
    100% RSU. $25 strike price for options is ridiculous. Confluent may worth $10/share after IPO if cloud conversion fails. They may worth $100/share otherwise, but I don't think it will happen soon after IPO.

    Just ask for more RSU.
    May 30, 2021 8
    • What do you mean it’s old? Does it matter inside the company when generating offers? Are new offers based on some sort of a new internal only valuation?
      May 31, 2021
    • Google
      itdhkxkh

      Go to company page Google

      itdhkxkh
      Update: Cloudera will be taken private for $5.3B, so if cloud conversion fails for Confluent, I think it will worth at least $5B, not $3B. I don't see any reason why the cloud conversion will fail though, so I would stick with my $100/share prediction for now.
      Jun 1, 2021