Want to make big money with your employee stock options (ESOs)? Then you’re in the right place.
While most companies give you only a base salary, great companies give you a base salary and Employee Stock Options. ESOs means more potential earnings.
GrowthAdvisor can help you boost your potential Stock Option earnings from an industry average of $6K per year to a whopping $80K per year. And more.
In this post, you’ll learn:
What are ESOs;
How they work;
Why companies offer ESOs;
How to boost your ESO’s earnings;
ESOs are your right as an employee to buy your company’s shares at an agreed-upon price and at an agreed-upon future date.
In a nutshell, you can buy your company’s stock at a lower-than-market price, then sell it and pocket the difference.
When you start working at a company, if ESOs are part of your compensation package, you’ll get an Employee Stock Options Agreement.
This Agreement will outline your ESO terms:
How many ESOs you’ll get;
When they’ll “vest” (when can you turn them into shares and sell them);
What’s your ESO’s “cliff” (a period of time before vesting starts);
What’s the ”strike price” (the amount you need to pay to turn a vested share into the one you own);
If you want to learn more about how a typical Employee Stock Options Agreement looks like, read this article.
How to boost your ESO’s earnings
Let’s say, you’re positive that you got a generous amount of ESOs. How do you know for sure? And how do you earn the most from them?
Don’t worry. We’ve got you covered.
Head over to GrowthAdvisor and compare companies:
compare companies with the highest-earning ESOs will be in the Fast Lane category;
companies with medium-earning ESOs will be in the Middle Lane category;
companies with low-earning ESOs will be in the Slow Lane category;
Think of your career as a highway.
You’re driving a car. Why drive in the slow lane at 35MPH, when you can drive in the fast lane at 65MPH?
Let us illustrate with Mike’s story.
NOTE: If the company hasn’t gone public yet (if it’s pre-IPO), Mike paid money with no return. But, this is true only if Mike actually paid for the shares.If Mike leaves XYZ or if XYZ fires him before he’d worked there for a year, and if he didn’t exercise his options, he’ll get nothing. However, if he paid for his vested options, then he owns the shares. And if the company exits after he leaves, he’ll get a windfall and a return on his investment. The obvious choice for Mike is to stay at XYZ for four years, for his ESOs to fully vest. A lot of things can happen in four years. XYZ could become a great success and go public. Its share price might skyrocket from the initial $0.25 per share to $20 per share. A huge gain.
NOTE: It’s common for all shares to automatically vest on an exit like an IPO.Wow. Mike can potentially make an amazing gain of $790,000. But what if XYZ doesn’t do so well? What if instead of going public it gets acquired or has to shut down? GrowthAdvisor can help you understand what would happen, if your company:
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REMOVE THE MYSTERY Get access to real-time market data. Compare valuations of over 800,000 companies with our Company Ratings. HOW IT WORKS Enter your company’s name. Done. Comparing different companies’ Employee Stock Options value is easy. Just enter the company’s name and see how much it could make you. START GROWING YOUR WEALTH Join GrowthAdvisor […]