@Jonsnoww Here's what I am aware of: 
 1. Will your esop unit get multiplied? 
 If the share price is around 1k/2k before the ipo, there is a good chance of a stock split / bonus shares issuance, which would increase the number of esops you hold 
 2. Will exercise price increase before ipo?  
 This would vary from company to company  
 3.  Tax? 
 There would be a perquisites tax and a stcg/ltcg tax whenever there is a profit booking involved  
 4. Unaware of this

Software Engineer

It would be great if someone can answer this

Primarily, my question targets startups which went ipo where you may joined when it was a private company and later it went public and you liquidates it.   will your esop units gets multiplied befo...

Welcome to Indian Startups's Private Community

Primarily, my question targets startups which went ipo where you may joined when it was a private company and later it went public and you liquidates it. 
- will your esop units gets multiplied before ipo?
- will exercise price gets increased before ipo?
- what about the tax?
- are there any unknowns and nuances involved which you were not aware of and later realised?
I hold esops in a startup and want to understand how this works during an IPO

How much did you earned through esops via IPO?

How much did you earned through esops via IPO?- Grapevine

Say you have ESOPs in a company. Once the company goes public, is there a holding period applicable for the esop before which it can not be sold?
Like 1 month/3 months/6 months holding periods?

Can someone also explain how the conversion of ESOPs to RSUs happens after IPO?

And mainly, tax implications and how to save tax?

Can someone explain esop selling during/after ipo

I’ve not exercised my ESOPs from my previous employer. I am waiting for the company to go public. I quit the company in 2021. What will my tax be if I exercise and sell my stocks at the time of IPO? How much tax can I save if I buy a property?

ESOPs taxation

Analyst

What happens to unexercised ESOP after IPO? I got to know that ESOP gets taxed at the time of exercise so it could lead to a huge financial burden. Also, is it possible to defer taxes after exercising of esops?

Unexercised option after IPO

At an early stage startup that is VC funded. Had posted a question on understanding esops which provided great clarity. Now curious as to how much people actually have ended up making from ESOP buybacks. Would be great if you can share- initial exercise price, quantum of esops and final price at which you sold. I currently have 25L in esops for a 2M$ funded company at a strike price of 10.

How much did you make from buybacks

Management Consulting

Hi GVers,
For those who've seen their company IPO (Zomato, Nykaa, PayTM, Delhivery etc.) during their tenure, by how much did you ESOP value appreciate after the IPO? Also, how long before the IPO had you joined the company?

For those who've seen buybacks and secondary sales in their company
How much did your ESOP value appreciate during such events, if any? How long ago before the event had you joined the company?

PS: I've heard ESOP value for some IPO borne companies appreciate by 2x after the IPO.

Wealth creation from ESOP

Strategy Consulting

If I’ve got an offer with ESOPs, but the vesting starts after a year and the company might go public before I complete a year. Been told by friends that no organisation has ever respected ESOPs that aren’t vested if they go public. What are your thoughts? Anyone who has faced something similar?

Help me understand my ESOPs

Senior Program Manager

Truths about ESOP 101 

After working in multiple fast growth startup’s and having been part of multiple buybacks as well as being in the startup ecosystem for a decade I want to put to bear my pov about creating wealth through ESOP. 

Like any other randomised event, ESOP also follows Pareto principle which means a very small number of people within the company ever make sizable wealth that they elevate to the top 0.1% of the country. 

The Pareto also applies with companies; significantly small minority of companies in India have employee friendly policies which enables an employee to create wealth. 

Most startup’s have dark patterns within their esop policy which either locks you in for insufferable durations or forces you to pay exorbitant taxes to gain the right to exercise your esops when you are leaving the company. 

Survivorship bias plays a huge role in enabling the narrative that esop is a great wealth generating tool leading to rude awakening for an employee after they join a company. 

This doesn’t mean you can’t make wealth, it just means don’t get carried away by narratives and take preventable errors in your career. 

Always talk to multiple people in startup’s and ask relevant questions to understand esop policies better. 

Like everything else optimising only for esop for wealth creation will mostly not result in it.

Unmasking ESOP wealth!

Consultant

Welcome to Product Managers's Private Community

I work in a fintech company. Revenue and growth wise we are good, we just got acquired by a large internet platform too. Also, last year has been a tremendous learning for me as well. I like being PM but looking to move out of my current industry (lending) as I want to explore other domains and I feel like my CTC here is somewhat low (18.5 + 1.5 bonus) considering my experience (around 4.5 years). My boss said that I will get ESOPS (around 10 lacs) which I can liquidate around 50% this year. Should I wait for my appraisal to complete (will happen around April) and look to switch or should I start preparing for interviews now itself?

Company is good but CTC pinches

Product Manager

Welcome to Software Engineers's Private Community

Hi, I have an ESOPs related question. Appreciate any inputs. 

Consider a Series B startup providing an employee with 5000 shares. After 2 years, 2000 shares are vested and exercised by the employee. The stocks were never liquidated because the company didn't conduct buyback nor went IPO. 

Now, assume the company lays off that employee after 2 years,

- Can he still hold the vested and exercised 2000 shares? 
- If yes, then can he sell those stocks during future buyback even if he isn't an employee?
- Will the company provide accelerated vesting for the remaining 3000 shares during layoff? (not mentioned on offer letter)

Question on ESOPs

Welcome to Business Roles's Private Community

ESOPs is offered by an early age startup. What are the things I does be aware about? or ask the founders to clarify with me.

Human Resources

Welcome to News Discussion's Private Community

Any news on who is getting it, what's like an average payout for eligible employees? As per the news article, approx 19000 employees are getting it. Anyone has insider info?

Flipkart ESOP payout worth $700M

Founder

I have recently left Tekion and was considering executing my ESOPs. For executing my ESOPs I need to pay around $3.5 per esop to the company. Should I convert my esops to equity? Am looking for some advice from the folks who might have done this in the past.

Tekion ESOPs Execution

Hey 👋  
  
 I have worked with a lot of my clients who own ESOPs. 
  
 Some points to consider in your case: 
 1. Tekion is not a listed company. Finding a buyer for the shares will be difficult. Considering this, Are you comfortable holding the shares till IPO? 
  
 2. Tax: You will need to pay tax at the time of exercising ESOPs. Again, are you comfortable with paying tax upfront?  
  
 3. If you wish to sell shares through brokers, check if company has right of first refusal. This way, you can a good deal and sell the shares to company (prior to IPO).

Software Developer

I am at a VC backed early stage startup. Have been offered Esops.l but have no clue on this.  Can somebody explain to me how can I make money from ESOP by answering these-

1) Do I have to buy them post vesting period? If yes, what amount do I need to pay? Also will there be text on this purchase itself?

2)) When the company buys back from me assuming my vesting was over and I could hold them on, what's the amount I will get? I am assuming it's (no of options * current share price) - (no of options * strike price issued to me). Is that correct? If yes, how is the current share price calculated for non listed company?

3) Now when the company buys these, what's the tax I have to pay? I am trying to understand if availing options and selling options are different and if both have taxes

4) What happens in IPO? Who buys from me? Where can I sell? What price do I sell at?

How exactly does an ESOP buyback work?

Hi, Say a Series B (US) funded startup gives me 3000 shares which are worth $5/share. It follows the usual vesting period of 4 years. Now assume 4 years have passed and all the 3000 shares are vested but the company hasn't gone IPO. 

Here are my quesions

- When exercising US stocks in India, what is the % of withholding tax I should pay?
- Say if I exercised all the shares and if I decide to leave the company do I get to keep those exercised shares with me forever?

I prefer answers from people who have exercised ESOPs before. I don't want answers like "It depends, Talk to your HR or CA". Appreciate any inputs.

Question on US based ESOPs in India

Hey everyone, excited to be doing this AMA!

A brief about me, I work currently as a Director of Product at an Indian unicorn startup 

About my career: 
- Did my undergrad from IIT and then masters from an Ivy league school
- Have been in product for almost 10 years now - across 2 Indian unicorn startups and a publicly listed company

Would love to take questions on what it means to be a PM, growing within the role, building your career, and other things :) 

Will be back here at 4 pm and start replying
Shoot away!

AMA 🎙️: Hey all, I am pmsprint, Director of Product Management at a Unicorn in India!

So say one has 100 ESOPs which a person exercised and converted to say 1000 shares  in say Jan 2024

Now if IPO happens in aug 2024, what will be the long term capital gains tax rate for these shares.

Will the tax rate change if one sells them say in Feb 2025, sept 2025 , Feb 2028 considering tax policy, tax rates to remain unchanged?

How's are captial gains taxed post IPO sell off?

UX/UI Designer

Please share how your company esop policy is. Is it really valuable for employees or just used to create hype and retail talent. 
How many years can you exercise them after resignation?
How did the taxation go if someone has been lucky enough to convert it to cash?
Should esops be a factor while leaving current company or joining a new company?

Are ESOPS really worth it? Has anyone built considerable wealth through it? Share experience.

I am in discussion with some very early stage startup and if things work out then will be part of the founding team. They have promised to give me same salary as the current company’s salary but give ESOP. Is ESOP worth it if you are founding team member?

The founder has sold his previous company so higher chance of success it looks to me.

Is there any case where person made huge money on ESOP?

How much did you earned through esops via IPO?

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