VC Masterclass, featuring Benjamin Beltzer
Understanding Startup Stock Options
Benjamin Beltzer is a senior software engineer at YC grad and identification software provider Berbix, which has raised $11.6M to date. He previously founded the dog care community platform Paw and was a lead software engineer at Apple, in addition to working at other startups. His article was featured on YC’s blog.
Most startups offer employees stock options with a given strike price, which gives the holder the option to buy the stock at that given price. If, when the company has gone public, the traded price is higher than the strike price, it makes sense to exercise the options; if it is lower, exercising would result in the holder losing money.
Most options are subject to a vesting schedule, which incentivizes workers to...