ESOP/Stock Options Calculator

What is ESOP/Stock Options Calculator?

An ESOP (Employee Stock Ownership Plan) calculator models the value of employee stock options by considering the grant size, strike price, vesting schedule, company valuation, and potential exit scenarios. It helps both founders designing compensation plans and employees evaluating offers.

How to use this calculator

1. 1Enter the number of options granted, the strike price (current 409A fair market value), and the vesting schedule.
2. 2Input current company valuation and your expected exit valuation range across low, base, and high scenarios.
3. 3Review the option value at each exit scenario after tax, accounting for exercise costs.
4. 4Use the output to clearly communicate realistic option value to prospective employees.
5. 5Rerun the model after each funding round to give employees updated context on their option value.

Why this matters for founders

Equity compensation is a startup's primary tool for attracting talent that it cannot afford at market salary rates. Understanding the true value and cost of option grants helps founders budget their option pool strategically and helps employees make informed career decisions.