Startup stock options - what are they worth these days?
We are getting clear signal from a number of different angles—new valuations, secondary markets, etc—that startup valuations got ahead of themselves over the past 2 years.
Another, more hidden data point? How often employees are exercising their stock options before they expire. We looked at "in-the-money" grants in this case, which means only options where the current valuation was above the strike price were included.
(side note - if you want to be an expert in how to think about your equity as a startup employee, join the Carta + Charthop webinar tomorrow! Link in comments, all sorts of good data for you there).
𝗞𝗲𝘆 𝗙𝗶𝗻𝗱𝗶𝗻𝗴𝘀
1. Most employees are faced with the choice to exercise their grants when they leave their current company - either by choice or through a layoff. So this is an acute decision.
2. Only 36% of grants were exercised in May (3-month trailing average). This continues a loooong decline from the peak in late 2021.
3. Employees are choosing not to exercise because...lots of reasons! A few include: want to keep cash on hand, no belief in the company (that sometimes just laid them off), a general souring on startup valuations as a whole, other personal financial reasons, etc etc.
More of an emotional and psychological signal than anything else - but a data-driven view into employee sentiment.
#cartadata #charthop #equity #stockoptions #startupemployee
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