As I sit here in Boulder watching MI-5, taking care of Amy, avoiding SXSW, and catching up on RSS and email, I came across a post from Albert Wenger (USV) that rang true. It’s titled A Rational Internet Venture Valuations Bubble and is insightful, clever, and though provoking. Easily the best VC post of the week.
Today’s VC post of the day is from Albert Wenger (USV) and titled Presenting Option Grants to Boards. This is feedback I give to CEOs 98% of the time after my first board meeting. While there is no standard for how to present option grants, Albert lays out a very clear set of eight pieces of data he likes to see. The first four are the the columns in the spreadsheet and each employee / option grant are the rows. The next two are footnotes for options grants that aren’t standard. And the last two are contextual data that should always be included since board members are on multiple boards and won’t remember this from company to company.
Here’s are the eight pieces of data – go read the post for more details on why all eight are necessary.
- Employee name
- Title/role at company
- Absolute size of grant in number of underlying shares
- Percentage size of grant fully diluted
Footnotes data (for option grants that aren’t standard)
- Special vesting considerations that differ from the plan
- For refresh grants: how many options does the employee already have and how far are those vested?
- Total size of option pool and remaining available pool (absolute numbers and percentages fully diluted)
- Grant size bands by role (if you have established those already) — if not, include existing employees in similar roles for comparison (including their start dates)