[ryandamm]

This is a good point. The converse is also true, though: high valuation means you have lots of dollar-valued equity to use to entice possible employees. And that scales with your valuation.

Fun fact, a friend was complaining to me about how hard it is to hire Android engineers, because he keeps getting outbid by Uber. He's at a public company, by the way, but couldn't match their pay packages (including ~$1m in stock options).

Yes, you won't necessarily see the same crazy run up in stock value as if you joined at the ground floor, and yes, you'll owe taxes on the nominal value of the option price, etc... but that's still a lot of money, and it's arguably de-risked relative to an A-series startup. (Then again, if the company you're looking at isn't profitable, maybe it's not de-risked... buyer/employee beware.)

[mahyarm]

Uber is a bit of a special case. It's basically the next potential facebook / google.

[otterley]

If you join Uber at this point, you're only getting RSUs, not equity. They're way too large to offer shares to any more employees without triggering SEC disclosure requirements.

[mahyarm]

TBH, RSUs are better if you cannot afford to early exercise. Otherwise you have the 90 day option expiry problem after leaving your job, unlike most RSUs. Options also get bad with AMT tax if you didn't early exercise either. RSUs stay with you even after you leave the company.

Oh well, you lose long term capital gains tax benefits, but most people do not have the money to even exercise their vested options, so they sell during IPO and have equivalent tax treatment as an RSU.

Some companies now have option expiry dates at 7 years, but those can be counted on one hand.