Those who exit to start ups how do you ‘value’ the equity. Have an offer from a late stage startup giving me 100k of equity. They’re last valued at 4bn and I assume they’d ipo within 2 years. Is it paper money till something happens? Cash comp is a little lower than consulting

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Made a similar move and recently left the startup. I would consider the equity as an unlikely bonus. If they don’t ipo anytime soon, will you be happy with the cash comp and work experience?

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I think so - the people seem sharp and would learn about tech/saas. What made you leave?

Base it on how many Stanford and MIT grads they have at the helm. If there’s a lot of them, you’re good

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Good technologists ≠ good business minds

You just need to look at metrics, it’s as simple as that. What’s their revenue, current unit economics, growth path, if they raised at a 100X revenue multiple, you know they’re not IPOing for many years or it will have shit upside. On the contrary if it was a 20X multiple & they’re still growing fast, yes there may be good amount of upside.

The brand of talent & hearsay have little to do with what matters

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Generally either 0 or face value if its a strong company that's unlikely to go under and based on the latest funding round.

Would always treat it as a bonus rather than in hand as its always at risk

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Make an assumption on when IPO will happen and likely value at that time. Since this is late stage, the $100k face value is probably a good bet. When comparing to other offers, I'd look at average total comp between now and when you think IPO will occur. Given current inflation, I would discount all cashflows

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Lots of questions. When were they last valued? What makes you think they’ll IPO soon given the current economic conditions?

Or significantly less. No guarantee of 100k worth of value by the time you’d legally be allowed to sell, which is roughly ~6 months post-IPO, which the initial sticker shock of an IPO has worn off investors

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