Founder's stock
I am entitled to a slice of founder's stock. I have 2 question related to them
a) Do founder's stock have a vesting schedule or are they immediately vested
b) what is the strike price at which they can be exercised
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Nobody can answer those questions without more information. You need to talk to the other founders to see how they/you intend things to work. Ideally, you'll have agreement documents to sign which will include all the details you need. Good luck and don't be afraid to engage your own professional advisor if you need help with this stuff. – Steve Jones 11 years ago
1 Answer
a) Smart companies have a vesting schedule for founder's stock. Many companies are not smart, and issue founder's stock with no vesting. Having no vesting (immediately vested) is a recipe for future disaster, and it is still the norm.
b) If you are being issued with stock there is no such thing as a 'strike price'. Instead there will be a 'purchase price'. You will pay the company in cash - normally fractions of a cent per share if you are a founder, so it will be hundreds to low thousands of dollars - and in return will receive shares. You own them today. (Your vesting should take the form of a share buyback, where the company can buy back the unvested shares for the price you paid.)
A 'strike price' is a term used for options. Options are not stock: they are a contract that gives you to right to buy stock in the future. They are supposed to give (most of) the potential upside of stock, (mostly) without the rights that stock owners have.
