Employee Stock Options (ESO) Fund
We know the dilemma from firsthand experience: should you exercise your stock options, or should you let the options expire? Can you afford to tie up substantial amounts of money in an illiquid stock for a long period of time? The high failure rate of startups makes the decision even harder, especially with extra costs such as the Alternative Minimum Tax (AMT). Now you can get liquidity for your stock options.
The Employee Stock Option Fund provides current and former employees of venture backed companies with the cash needed to exercise their options and cover associated taxes. By partnering with ESO, the employee retains potential upside. If the company goes under and the shares are worthless, ESO bears the risk and not the employee.
In other words, you can have your cake and eat it too. If you represent company management and facing the dilemma of whether to change your entire option program to NSOs or RSUs, letting ESO selectively address individual situations for you is a lot less expensive to the company than letting 100% of the departing employees capture equity without investing a penny.
3 Ways that ESO Can Help with Your Options
Does this sound familiar? You’ve worked for years to vest your stock but the IPO is delayed. A dream job comes along but you can’t afford to exercise.
Don’t let your options expire worthless or stress out by tying up your cash for years. The ESO Fund allows you to capture upside and still keep your cash free for other needs.
Did you exercise your incentive stock options (ISOs) last year and are now caught off guard by a large Alternative Minimum Tax (AMT) bill? This bill can be huge if the fair market value is now a lot higher than your exercise price.
Since the cost of exercising options can be quite high, a large tax bill just makes the process more burdensome and risky. ESO Fund can help you cover the potential tax bill as well as refund your original exercise.
Do you have a sudden need for a lot of capital? (Buying a dream house, medical bills, tuition, etc.) Restricted private stock isn’t an asset that traditional lenders will accept as collateral, but ESO offers a solution.
If you partner with ESO on the shares you already own, we’ll advance cash to you based on the future potential of this stock. No payments are due unless there is a major liquidity event, such as a sale or IPO. If the stock becomes valueless, ESO takes the loss.