[molsongolden]

OP isn't attempting to calculate any sort of actual market value for the options, the post just presents a method for determining how many options to grant employees by assuming:

* Investors recently paid FMV per share

* The employee's cost per share will be 409a_value

* The company is actually worth or grows into the current valuation

therefore

* Each share in the employee's grant is theoretically worth (FMV - 409a_value) to the employee

* This value can be used to determine how many shares to grant new employees given the % of base salary equity targets.

Another method might be to use different % of base salary targets and divide that equity value by the current 409a_value instead of the intrinsic value, or to offer flat % of ownership grants by role.