When talking about Equity Compensation, a form of pay that gives employees an ownership stake in the company. Also known as employee equity, it can come as Stock Options, the right to buy shares at a set price, Restricted Stock Units (RSUs), shares that vest over time or newer Token Grants, crypto‑based awards that behave like equity. Together they let talent share in a company's upside while aligning incentives across the team. Understanding how each piece works is the first step to turning paper promises into real wealth.
Equity compensation requires solid tax planning because the timing of vesting, exercise and sale triggers different tax events. For example, exercising stock options before a big price jump can lock in a lower tax base, while holding RSUs after they vest may lead to ordinary income. Token grants add another layer: they often fall under both securities and crypto tax rules, meaning you might need to track fair market value at grant and at each transaction. The employee stock purchase plan (ESPP) is another tool that lets workers buy shares at a discount, effectively boosting the value of any existing equity awards. All these elements influence each other – a well‑designed compensation package blends options, RSUs and possibly token grants to balance risk, liquidity and reward.
Below you’ll find a curated set of articles that break down each type of award, show real‑world examples, and walk you through the calculations you’ll need to make informed decisions. Whether you’re a startup founder structuring a new plan or an employee trying to maximize your payout, the posts in this collection will give you practical steps and clear explanations to get the most out of your equity compensation.
Explore cliff vesting vs linear vesting, their pros, cons, hybrid models, and implementation tips to choose the best equity schedule for your startup.
