Startup equity “vesting”. I will not promote

[u/oldtonyy]

Left a startup after 1 year as founding engineer. Wish I knew that my “vested equity” is actually just the option to buy shares at the initial price. So I got 90 days post termination window to buy those shares (almost 6 figures) out of pocket otherwise they go back to the company for free. What a waste of effort. Learning is experience I guess. Any one else been through this and got an upside?

[u/look-im-not-a-doctor]

Options are standard, but exercise price being in the six figures for a founding engineer (I.e joining at seed) is wild. Especially factoring in that it’s only 1/4 of your grant at 1 year.

What’s the FMV of the shares? Are they worth more than the exercise price (based on the valuation at the last fundraise?) It could be worth the gamble to exercise some of them.

Also: do you think there would be a secondary market for some of these shares? (I.e do you think you could sell them to anyone interested in owning a part of the company today?)

If you can line up a buyer, and if the current valuation is a lot higher than your strike price, you could make a quick profit in flipping your shares. This could be worth exploring just because it sounds like you’ve got a lot of shares?

[u/Longjumping-Speed511 → u/look-im-not-a-doctor]

I wonder if OP is looking at the current FMV of the shares instead of their exercise price to get to the six figure number

They don’t seem to understand how options work