Equity 101 Part 1: Startup employee stock options
Startup Codex

This three parts post features the basics of startup stock options from the employee's point of view.

It covers a number of topics: the different types of stock options, the stock option agreement, the vesting schedule, the employee departure, the strike price, the valuation, the dilution, and the tax treatment.

A very good starting point for any employee who might benefit from stock options when joining a startup.

Read Part 2 here

Read Part 3 here

If you leave the company, your shares will stop vesting immediately and you can only buy shares that have vested as of that date. And you only maintain this right for a set window of time, called a post-termination exercise (PTE) period. Historically, many companies made this period three months. However, some companies offer more generous PTE periods now. At Carta, for example, you have as long as you worked at the company to buy your shares.

Don’t forget about these windows. Your company isn’t obligated to remind you when you leave — they usually only tell you in your option agreement when you first join.