10 Questions to Ask About Your Equity Compensation

Written By: Jillian Climie.

Equity compensation can be one of the most valuable parts of a job offer, but also one of the hardest to understand. Between different types, vesting schedules, grant cadences, expiry dates, and unique program structures, it’s a lot to navigate.

If you’re joining a new company and equity is part of your package, here are 10 key questions to ask before signing on.

1. What is the grant date dollar value?

Oftentimes if you’re being granted restricted stock units (RSUs) or performance stock units (PSUs), they will be presented as a dollar value. For example, a $20,000 RSU grant. However, stock options (and sometimes RSUs and PSUs as well) are often presented as a number of units. For example, a grant of 6,000 stock options. This is not very helpful…how can you objectively evaluate the offer if you don’t know the value of the equity?

If this is the case for you, ask for the following:

• What is the grant date dollar value of these stock options? Ideally, they’ll provide an approximate value.

• If they can’t share this for privacy reasons (common at private companies), ask: What percentage of the share pool am I receiving? You can then compare this against market benchmarks to understand how competitive it is. 👉 Tip: Leverage EquiPay for market context, our compensation market data platform designed exclusively for individuals.

• If neither is available, ask for any context that will help you understand value. 6,000 stock options at Meta are worth something entirely different than 6,000 stock options at a struggling start-up, so it’s important to have a general understanding!

Reminder: For stock options, the value is not simply the share price multiplied by the number of units. Stock options are valued using financial models like Black-Scholes or binomial, which take into account volatility, expiry dates, and risk.

2. Is this a one-time grant or an annual grant?

This detail is often vague in contracts. Getting an equity grant once versus receiving one every year is a significant difference. Make sure you know which applies to you!

3. What is the vesting schedule?

Most equity doesn’t become yours right away. You may receive a grant on January 1, 2026, but it won’t fully vest (i.e., become yours to keep or sell) until three years later.

Be sure to understand what the overall vesting time frame is, as well as:

• Is the vesting gradual? I.e., you receive portions each month or quarter.

• Or is it cliff vesting? I.e., you receive larger chunks after one or more years.

Typically, the shorter the vesting schedule the better as it means you can access your equity sooner.

4. For stock options: What is the expiry date?

Stock options expire after a set period of time. If you don’t exercise them before that time, they’re void and worth nothing. Longer expiry dates give you more flexibility. Most stock options expire 5-10 years after the grant date, so it’s important to know where yours sit within that.

5. Are there any other program-specific items I should know about (e.g., performance conditions)?

This is a broad but essential question, as equity programs can include many unique features. The most common one I flag is performance conditions - requirements beyond share price for the equity to vest or to determine the final value of the equity. For example, the equity may only vest if the company reaches a certain revenue target. These conditions increase risk (and sometimes reward), so it’s essential to understand them up front.

6. Is this the only type of equity you offer?

If you’re being offered stock options, ask whether the company also grants RSUs, PSUs, share appreciation rights, or other forms of equity. You may want to negotiate for a different mix depending on your personal risk tolerance.

7. For private companies: Under what conditions can I sell stock or exercise options?

A downside of private company equity is liquidity: you can’t always sell vested equity immediately. Ask:

• Under what circumstances can I sell or exercise?

• Has the company held liquidity events in the past?

• Are any planned for the future?

This context will help you understand whether you can eventually turn vested equity into cash.

8. For publicly listed companies: Are there any restrictions on selling?

At public companies, it’s important to know if there are restrictions around sales. Executives in particular may be subject to insider trading windows or blackout periods where selling is prohibited.

9. What happens to my equity under different termination scenarios?

Find out what happens if you were to be terminated without cause, voluntarily resign, or retire. If the company is publicly listed, these rules are likely documented in the equity plan text which you can find online. At private companies, you’ll often need to ask directly.

10. Situation dependent: What tax considerations should I be aware of?

Equity almost always comes with tax complexity. This is especially important if you are required to travel frequently for work, live in a different state / province / country than the company, or are offered more complex forms of equity.

Ask whether the company provides tax support or if there are specific considerations you should know about before accepting.

Final Thought

Getting clarity on these questions will help you better understand the value of your equity, and negotiate more effectively. A good guiding question to ask yourself is: How much do I believe in this company? Your confidence in its future will shape how heavily you want to weigh equity versus cash in your compensation package.

For market context, check out EquiPay: the first market data platform built for individuals, offering detailed insights into where your equity compensation sits against market benchmarks. It was designed by compensation experts who have spent their careers working on equity programs. Click the link here.