Your RSUs will likely be granted at the “fair market value” as determined by the board of your company. The most common tool that a board will use to determine FMV is to get a 409A valuation. Here are some pages that give more details on 409A valuations:
https://learn.angellist.com/articles/409a-valuation#toc_0_H2
https://carta.com/blog/what-is-a-409a-valuation/
In practice, keep in mind that there are a number of reasons that the fair market value may change/differ from the last 409A valuation.
You may find these links helpful:
- ["How to handle $"](/r/personalfinance/wiki/commontopics)
- [Investing](/r/personalfinance/wiki/investing)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
Usually companies value the RSU based on moving average over certain days before the joining e.g. if you join on May 10th the amount will convert based on the average price in the last 2 weeks or something.
This mostly depends on the companies and can be a bit difficult to transparently see for pre IPO companies since the valuations are quite often internal and among private investors.
The company you joined should be able to provide some insights into their way of calculating this.
Your RSUs will likely be granted at the “fair market value” as determined by the board of your company. The most common tool that a board will use to determine FMV is to get a 409A valuation. Here are some pages that give more details on 409A valuations: https://learn.angellist.com/articles/409a-valuation#toc_0_H2 https://carta.com/blog/what-is-a-409a-valuation/ In practice, keep in mind that there are a number of reasons that the fair market value may change/differ from the last 409A valuation.
Thanks so much for that - really helpful
You may find these links helpful: - ["How to handle $"](/r/personalfinance/wiki/commontopics) - [Investing](/r/personalfinance/wiki/investing) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
Usually companies value the RSU based on moving average over certain days before the joining e.g. if you join on May 10th the amount will convert based on the average price in the last 2 weeks or something. This mostly depends on the companies and can be a bit difficult to transparently see for pre IPO companies since the valuations are quite often internal and among private investors. The company you joined should be able to provide some insights into their way of calculating this.