Had about ₹14L worth of vested options when I resigned at a previous company. Strike price was ₹10, FMV was around ₹400 (approx) at the time.
The HR mentioned I had 90 days to exercise during my exit interview. What they didn't mention and what I found out on my own at two weeks later was that exercising meant paying perquisite tax on the difference between FMV and strike price.
And all that was to be paid upfront from my pocket.
That was roughly ₹4.1L out of pocket to just own shares.
And these ESOPs were sold to me as if they were some big reward which we were supposed to work hard for.
The company had never done a buyback or plans to go public.
I let them lapse.
The company did end up a Series B a year later at nearly double the valuation and also did some buyback for ESOP holders.
I'm not saying this to be dramatic about it. I'm saying this because nowhere in the offer letter, nowhere in the ESOP grant document, nowhere in HR's explanation did anyone tell me the actual cash math of exercising and that the company may do a buyback during the next fundraise.
It's almost as though they were hoping that I didn't exercise the stock options.
Is this an isolated case or do a lot of startups do this to their employees?