Question 1

How much will my startup equity be worth at exit?

Accepted Answer

Your equity value depends on: number of shares, strike price, company exit valuation, dilution from future funding rounds, and vesting schedule. Use our calculator to estimate various exit scenarios and understand the impact of each factor.

Question 2

What's the difference between ISO and NSO stock options?

Accepted Answer

ISOs (Incentive Stock Options) receive favorable tax treatment - if you hold shares for 1+ year after exercise and 2+ years after grant, gains are taxed at long-term capital gains rates (15-20%). NSOs (Non-Qualified Stock Options) are taxed as ordinary income when exercised, which can be 35-50%+ depending on your tax bracket.

Question 3

How does dilution affect my equity?

Accepted Answer

Each funding round typically dilutes existing shareholders by 15-25%. If you own 0.1% and the company raises 3 rounds with 20% dilution each, your ownership becomes roughly 0.05%. However, the company's valuation usually increases faster than dilution, so your shares can still be worth more.

Question 4

Should I exercise my options early?

Accepted Answer

Early exercise can start your long-term capital gains clock for ISOs, potentially reducing taxes at exit. However, you're paying for shares that may become worthless if the company fails. Consider the strike price, your financial situation, and the company's prospects. Always consult a tax advisor.

Equity Exit
Calculator

Detailed Breakdown

Exit Scenarios

Understanding Startup Equity

Dilution

Vesting

Strike Price

ISO vs NSO

Equity ExitCalculator