> assume the company exits at its latest valuation and do the calculations of what your options would be worth in that case.
Sure, but even in this case, you have no idea what the provisions of that round are, most likely. The investors may have asked for better returns (money-back + participation), there may be lines of credit that have to be paid back first, there may be loans that are paid off the top. My point is that most non-executive employees can't get enough information to make an accurate assumption. It's possible, maybe even likely, that if you exit at your latest valuation, your stock is worth $0 of actual money when on-paper, it was worth something significant.
If cash-out is around latest valuation, weird terms will only change the $ amount by <10% or so.
If cash-out is less than the latest valuation, then it starts mattering. At ~40-50% of latest valuation, common shares can end up effectively worthless, for example Good Technologies.
Sure, but even in this case, you have no idea what the provisions of that round are, most likely. The investors may have asked for better returns (money-back + participation), there may be lines of credit that have to be paid back first, there may be loans that are paid off the top. My point is that most non-executive employees can't get enough information to make an accurate assumption. It's possible, maybe even likely, that if you exit at your latest valuation, your stock is worth $0 of actual money when on-paper, it was worth something significant.