EquityBee

EquityBee is a unique platform that helps startup employees exercise their stock options. Many employees cannot afford the cash required to buy their options (and pay the taxes) when they leave a company. EquityBee connects them with investors who provide the capital in exchange for a share of future profits.

For investors, it provides access to discounted pre-IPO shares. For employees, it creates risk-free liquidity. It is a legitimate solution to the "golden handcuffs" problem in Silicon Valley, having funded options for employees at companies like Airbnb and Palantir before they went public.

Frequently Asked Questions

1. How does it work for investors?

Investors provide the cash an employee needs to exercise their stock options. In exchange, the investor receives a contract entitling them to a share of the stock's value when the company eventually exits (IPO or acquisition).

2. specific minimum investment?

The minimum investment for the "Liquidity Fund" (diversified) allows for lower entry points, while funding individual employee options typically requires $10,000 or more depending on the specific deal.

3. Who can invest?

EquityBee is available only to accredited investors. You must meet the standard SEC definitions of wealth or income to participate in these high-risk, high-reward private market deals.

4. Is there a fee?

Yes, EquityBee charges a transaction fee (typically 5%) and carries interest (a percentage of the profit, often 5% or more) upon a successful exit. Fees are disclosed upfront for each deal.

5. What happens if the company fails?

If the startup goes bankrupt or shuts down, the investment is lost. The employee is not required to pay back the funding; the risk is transferred to the investor. This is non-recourse financing.