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How to evaluate stock options vs RSUs
I am getting an offer from a private company. Offering both RSUs and stock options.
what should be picked?
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6ym891ukphg5xkqSoftware Engineer
This article may have some primers that could help: https://www.levels.fyi/blog/evaluate-startup-offers.html
To exercise your stock options you'll have to pay the strike price per share. So there is a financial burden you incur, whereas with RSUs its just granted directly to you. However, options also do give you much higher upside since the 409a valuation is typically lower than the investor assigned valuation for the company. Usually companies will start to offer a mix of both when the financial burden to buy your options gets too high (who wants to pay six figures for stock that might be worth nothing), as a part of a more complete transition to RSUs. In my opinion, worth it to get up to as many options as you can financially afford (if you believe in company).
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