Stripe 1 year RSU and valuation timing

Amazon
sgdi11

Go to company page Amazon

sgdi11
Oct 20, 2021 26 Comments

Hypothetically, if one joins Stripe with an offer of say USD$150k RSU allocation in Jan 2022 and the valuation of Stripe changes within the year (another round or IPO) will there be any benefit in terms of the allocation or is it still $150k worth that you get for 2022 regardless? When is the allocation for the dollar amount determined?

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TOP 26 Comments
  • Amazon
    KewinMalon

    Go to company page Amazon

    KewinMalon
    There’s a some misunderstanding here, though , the 3 month preceding is based on your Joining date!! Not your vest date for the first year

    That means the number of stock units you’ll vest is frozen by the price before joining. So , even if the stock prices increase during the year or if stripe goes ipo , you will see the upside ! Though maybe not as much as typical policy , but it is not always going to remain same
    Oct 20, 2021 10
  • Stripe
    booyaaah

    Go to company page Stripe

    booyaaah
    Your initial grant is converted based on average closing price for last x days.
    Oct 20, 2021 6
  • Stays the same
    Oct 20, 2021 6
    • I meant to say you are given a fixed number of RSUs each year, the initial grant has a 1-year cliff but every subsequent grant (not counting any performance based refresher) also spans a year but vests quarterly.

      The reason this does not have much of an upside is coz usually stocks go up over a long period of time, like 4 years. So if I gave you the shares equivalent of X$ now that vests over 4 years instead of shares equivalent of X/4 each in year-1, at the beginning of year-2, beginning of year-3 and at the beginning of year-4, you’ll pick the former (if you believe the company will grow).

      Stripe may argue this minimizes the downside as well but you don’t join a company if you don’t believe in its growth potential.

      To your point about “there is an upside of company IPOs in 2022 and my shares for year-1 were assigned in Feb”, well you could also “buy” shares in the public market when it IPOs if you are that sure of the upside.
      Oct 20, 2021
    • Amazon
      KewinMalon

      Go to company page Amazon

      KewinMalon
      True , as I mentioned there’s no denial about limited upside . I was just chipping in to point that there’s no “no upside “ here which is what a lot of them assume and can be pretty confusing when the grants value during vest remain the same especially because it’s not always clear as to when the units locking happens for the year
      Oct 20, 2021
  • Stripe
    glugglugg

    Go to company page Stripe

    glugglugg
    Yes. That’s how it works
    Oct 21, 2021 0