I've seen a few job offers where in addition to the salary the company offers X,000 Restricted Stock Units (RSU). I'm still trying to understand owning equity as one of the early employees for a company. What do I need to know about RSU and the company to realize this would be a decent deal for additional compensation?
What if a public company's stock has been declining, is it worth taking the stock options or better to negotiate a higher salary?
Are there specific questions I should be asking about the RSU?
Do I end up having to pay for the RSU or is it something that the company typically gives an employee for free for employment?
Equity Compensation Stock Options
There is a big difference between owning RSUs of a public company or of a private one. Almost by definition, if it is a public company you won't be one of the 'early employees', you will get a tiny fraction of the shares in the company with more limited upside than if they were still private.
I haven't dealt with RSUs personally. As far as I know it is a contract, so the important thing to do is to ask for a copy of the contract, and understand all of the clauses very well. What happens if you are fired: do you lose all the RSUs? How long until you earn and can sell the stock? If the market price goes down will you get more RSUs to get a constant cash value of the RSUs, or is it a fixed number of RSUs no matter what the market price?
I'm curious if anyone else on this site has encountered RSUs. It sounds like something larger/later stage companies do more than early stage companies.