Comments on: Term Sheet – Vesting

By: » On Incentives RishniRatnam.com

» On Incentives RishniRatnam.com — Thu, 21 Jul 2011 21:17:07 +0000

[...] company. For me, this means minimising my salary (even down to zero) and maximising appropriately vested options. In this case I often ask for a “trial” period at the start, where I work for nothing [...]

By: Two Dogs and a Startup is expanding…. « Two Dogs And A Startup

Two Dogs and a Startup is expanding…. « Two Dogs And A Startup — Tue, 05 Jul 2011 17:11:21 +0000

[...] http://www.feld.com/wp/archives/2005/05/term-sheet-vesting.html - Talks about vesting and is part of a series about term sheets (relating to VC investing) – interesting read. [...]

By: Anonymous

Anonymous — Thu, 11 Nov 2010 07:48:00 +0000

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By: bfeld

bfeld — Mon, 22 Feb 2010 01:05:06 +0000

There isn’t a well defined formula for this. At some level, you just need to come up with a rationale that feels good since the FMV is also a relatively arbitrary number unless you’ve just had a financing event.One thing to note is that you can’t grant options below FMV (of the stock underlying the option – presumably common stock). Instead, you grant the option at FMV but give them MORE options than a 1 to 1 conversation would give. So – if you think 5x is fair, you should give them 5x the number of shares.

By: Manny.K

Manny.K — Wed, 17 Feb 2010 22:59:34 +0000

Thanks for the super helpful information and discussion. Between you and Dave Naffziger I've been able to gain a much better understanding of these vehicles and their implications to both the recipient and the company / founders //investors.

I do have a question though. As part of a pre-revenue startup (that was founded over 4 years ago and in development for years prior) that is interested in paying back working founders and consultants that have had deferred payments acruing from consultant agreements, and wanting to do compensate them using NSO options (we have a plan in place, but have not made use of it as yet), how does one go about valuing the NSO option grant price? Applying Black Scholes is a bit beyond our ken, but we believe that the options should be offered at an advantageous below FMV rate, perhaps 5x below and in a quantity that will allow the consultants to be compensated for cash owed plus the cash they'll have to lay out to execute the options, excluding taxes…..we're just not sure what the best way to arrive at that grant price is or what the implications might be if it's offered at too low a price (if that's possible).

Any input would be much appreciated. As a group we've all run successful service businesses but are preparing to raise capital for a manufacturing

By: The Burden of Legalities | alex j. mann (.com)

The Burden of Legalities | alex j. mann (.com) — Thu, 25 Jun 2009 19:05:31 +0000

[...] because of a few transitioning factors on my team, we have currently aligned a vesting schedule with different percentages for each member, which was agreed to upon each [...]

By: Technotheory.com - Bootstrap Maryland Recap

Technotheory.com - Bootstrap Maryland Recap — Tue, 05 May 2009 23:14:41 +0000

[...] While your legal status is not that important initially, it is important that you discuss ownership with any co-founders early on. You need to get in the habit of having these conversations when the money isn’t already on the table. Whatever you do with equity, just be sure that other team-members have to earn their equity rather than starting with it…otherwise underperformers can ruin the distribution of equity and create a difficult situation. This is called vesting. [...]

By: lee

lee — Wed, 20 Jun 2007 21:47:48 +0000

if a person is vested in some stock with the payout at a future date. during the period after the vesting date and before the payout date does the benficiary get to choose the investment options that the proceeds can be invested in or is the future payout based on the current value but just paid at a later date.

By: Basil Peters

Basil Peters — Tue, 29 May 2007 23:31:25 +0000

Great post. I believe there is a better vesting schedule than four year linear. In this early 21st century, Web 2.0 early exit, super tight human capital environment, many angels and early VCs in my area have been using a new formula that vests 50% linearly over three years and the other 50% only on a 'liquidity event'. There are several benefits to this new formula for both entrepreneurs and investors. I have been working to on a summary at http://www.angelblog.net/Share_Vesting.html Thanks, Basil

By: Roboo儒豹手机搜索引擎

Roboo儒豹手机搜索引擎 — Wed, 21 Jun 2006 17:58:58 +0000

Some founders get 3 years vesting schedule.