409a Valuations

A 409a Valuation is a compliance document that determines the fair market value (FMV) of stock and stock options. It ensures that you are not offering your stock options below FMV. It needs to be prepared by a competent individual or firm and approved by the Board of Directors.

If you find that  …

  • You need to put together an employee option pool
  • You need to get your board to approve the option pool & option grants 
  • You need to identify the fair market value (FMV) of the options 

 

… Then you need a 409A valuation of your options. 

 

At GrowthLab...

We help you understand the inputs and outputs of the 409A. In terms of inputs, one of the biggest is your cap table. Having management understand this is crucial to help you understand your decisions and how they are going to impact you in the future. 

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