EquityAudit: Automated Offer Term Analyzer for Startup Job Seekers

A few things would make me pause, not necessarily because they're deal breakers, but because I'd want to understand them better. The 30-day post-termination exercise window is shorter than many employees hope for, and it can put people in a tough position if they leave and must decide whether to spend a significant amount of money to exercise quickly. The vesting schedule also sounds less employee-friendly than the common one-year cliff followed by monthly vesting, although companies do vary. I'd also want to verify the ownership math. If there are roughly 110,000 fully diluted shares, then 200 options would be around **0.18%** of the company, so that part seems internally consistent. But I'd ask them to walk you through the cap table assumptions and how they arrived at the strike price versus the last funding valuation. More than anything, I'd ask for the actual equity documents and have someone experienced with startup compensation review them before making a decision. The biggest risks are often in the details, not the headline numbers.

A few things would make me pause, not necessarily because they're deal breakers, but because I'd want to understand them better. The 30-day post-termination exercise window is shorter than many employees hope for, and it can put people in a tough position if they leave and must decide whether to spend a significant amount of money to exercise quickly. The vesting schedule also sounds less employee-friendly than the common one-year cliff followed by monthly vesting, although companies do vary. I'd also want to verify the ownership math. If there are roughly 110,000 fully diluted shares, then 200 options would be around **0.18%** of the company, so that part seems internally consistent. But I'd ask them to walk you through the cap table assumptions and how they arrived at the strike price versus the last funding valuation. More than anything, I'd ask for the actual equity documents and have someone experienced with startup compensation review them before making a decision. The biggest risks are often in the details, not the headline numbers.

[www.captableexpert.com](http://www.captableexpert.com) here. 1. Probably fine. Remember, FMV of common stock is at a discount to any preferred. So , if the last preferred round closed at $125M with 110K shares, that's $1,136.36 PPS for that PREFERRED. But they are saying their COMMON is worth $500, which is a 56% discount to the preferred. Totally normal. Discount, depending on stack, stage, etc, ranges widely between 20-80% generally. This isn't a concern. Their explanation of "they can intentionally ensure employees are in the money" is a bad answer unless they didn't sell preferred and it's all common shares. 2. 30 days is not market, not standard. Maybe 15 years ago. 90 days is standard now (generally), but I've seen it longer. Same with vesting. Definitely not market. I would ask: ""I understand the company uses the NVCA financing documents. My understanding is that the equity plan itself determines the vesting schedule and post-termination exercise period. Most venture-backed companies use a one-year cliff followed by monthly vesting and a 90-day post-termination exercise window. Is there a reason the company chose annual vesting and a 30-day exercise period instead?" This is a very unfriendly term for employees. 3. Again, not very employee friendly. Generally, there is full (or at least partial) acceleration. Like "50% of unvested will vest on change of control with the remaining 50% to vest over the shorter of the time remaining or one year". The reason companies don't want full acceleration is that on acquisition people can quit. So now the acquirer need to incentivize people to stay. They know this and build that into the acquisition price (lowering it). Again, not way, way out of bounds on this, but not a friendly term. 4. I'd have to see a waterfall, but basically, they are saying "to get past the preference for the preferred class, we need to get to $200M and then they will convert into common and everyone will get their pro rata share". They are saying you have 0.18% fully diluted (as of now). Weirdly, if they sell for less than $200M, preferred would be better off taking their preference and not converting into common. You'd have a higher % but a much smaller pool of money to get distributed. I would say "no screaming red flags" but a bunch of marginal stuff that isn't very employee friendly. On the positive side, your salary + bonus isn't "startup" level, so that mitigates a ton of the risk.