Understand the instrument and ownership context
Ask whether the grant is options or RSUs where relevant, the number of shares, fully diluted share count, ownership percentage if disclosed, strike price, and the distinction between latest preferred valuation and common value. These facts describe mechanics; they do not create a reliable price forecast.
If a company cannot disclose a percentage, ask which information it can share and record the limitation rather than reverse-engineering certainty from a headline grant value.
- Private-company equity may ultimately be worth zero.
- Do not calculate a fake expected value from a funding valuation.
Read vesting, exercise, and liquidity terms
Clarify vesting schedule, cliff, exercise window, dilution, transfer limits, and what happens on termination or a change of control. Acquisition and IPO outcomes are uncertain, and the applicable paperwork controls.
A four-year vesting schedule with a one-year cliff means the timing of employment changes matters; it does not promise any liquidity event.
- Option exercise and tax treatment are jurisdiction-dependent; seek qualified advice for your circumstances.
- Do not assume an acquisition accelerates vesting without reading the actual terms.
Keep private equity separate from cash decisions
A private grant can be part of a long-term decision, but it should not be presented as guaranteed compensation. Compare predictable cash and subjective fit separately from uncertain equity scenarios.
Use the worksheet’s optional annualization only as grant value entered by you divided by vesting years, with no prediction about realized value.
- Do not use private-company equity to manufacture a 'best offer' score.
- Do not rely on informal chat claims in place of grant paperwork.