

Ask HN: As an employee, should I take equity or options? - safou

I've recently been employed by a fast growing, successful startup in New York.  We are currently doing ~$3M/year in revenue, and are on track to double again this year. As the first technical hire,  I've been offered around a 2% equity stake in the company (valued at $4M), which I can take as options or equity. The issue I'm having is that I don't currently have the money upfront to pay taxes for receiving equity.  Due to that, I may have to take it as options.  However, I'm a bit concerned about taking options, because I feel that if the company becomes successful, but not necessarily acquirable, my options won't be liquid.  The company founders (it's privately held, no VCs) in this case have shown interest in issuing dividends to shareholders in lieu of trying to sell. If the owners decide to issues dividends instead of reinvesting profits and selling the company, could my options become worthless and ineligible to participate in the dividends unless I purchase the shares at the strike price?<p>Long story short: I have the option to take equity or options, and no one is trying to screw me over, I just want to make sure I make the right call based on my financial situation and what's likely to happen to with the company company (more likely to issue dividends and remain private than sell or go public)  For lawyers: I believe it's an S-Corp.
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idunno246
If you took options and executed today, wouldn't that mean paying $4M for $4
in value, ie worth $0(vs own $4M in stock outright)? You lose the present
value with options.

