Stock Option and IPO Planning
Stock Option and IPO Planning
Darrow Wealth Management specializes in stock options and equity compensation. If your employer is going public, merging, or getting bought out, work with an advisor experienced with strategic stock option planning, tax implications, and strategies to best manage sudden wealth.
Clients include executives and founders who have a variety of equity compensation, including:
- Incentive stock options (ISOs)
- Nonqualified stock options (NQSOs)
- Restricted stock awards (RSAs)
- Restricted stock units (RSUs)
- Founders shares
- Profits interests
- Employee stock purchase plans (ESPPs)
Many clients have a combination of long shares and equity subject to ongoing vesting. Through our ongoing advisory relationship, we’re able to help clients with the entire equity compensation lifecycle from even before a grant to long after the sale.
Nationally Recognized Wealth Advisor in Stock Compensation
Selection of media appearances by Kristin McKenna CFP®, President of Darrow Wealth Management and a nationally recognized specialist in employee stock options and equity compensation.
Publications above reflect media organizations that have quoted and/or published articles authored by Kristin McKenna and should not be misconstrued as a current or past endorsement of Kristin McKenna, Darrow Wealth Management, or any of its advisors. Please refer to the media page for more information and links to published works.
Financial Advisor for Employee Stock Options
Especially for founders and early employees, stock options can create a major liquidity event that transforms your financial life. To maximize the opportunity, it’s critical to get the right team of advisors in place before making irreversible decisions with your shares.
Our team of stock option advisors can work to help you:
- Plan for an IPO or acquisition
- Develop an exercise strategy to balance potential tax benefits with risks of holding a concentrated stock position
- Assist with identifying and tracking shares likely to qualify for the tax-free sale of qualified small business stock
- Plan a tax-conscious liquidation strategy, considering different grants, holding periods, and outside cash needs
- Plan and execute a trading strategy including price targets, market vs limit orders, using options for long shares, considering liquidity constraints due to trading volume, liquidation order, and so on
- Assess ways to hedge the risks of a concentrated holding, such as the use of options on long shares, if permitted
- Assist in the drafting of 10b5-1 plan provisions
- Decide on a strategy to best use the proceeds, including funding multiple goals and investment management services to help you diversify sudden wealth
- Understand how vested and unvested stock options may be treated if you leave the company or retire
- Explore cashless or sell-to-cover exercises of stock options
- Approach employment negotiations around stock options and equity compensation
- Implement a multi-year diversification strategy through an ongoing wealth management advisory relationship
- Consider ways to further your charitable or legacy goals through different investment or trust vehicles
- Coordinate the approach with your tax advisor and estate planning attorney
Wealth Management Services
Darrow Wealth Management is a fee-only financial advisory firm and full-time fiduciary.
The Darrow Private Wealth Management Program offers clients a complete solution to their asset management and comprehensive financial planning needs.
Stock Option and IPO Planning Related Articles
Frozen IPO Market Reveals Dangers of Pre-IPO Exercising & Pre-Spending a Windfall
The Instacart IPO is on hold…again. What should employees with stock options do when their employer’s IPO stalls? In truth, best practices around an IPO are sometimes skewed towards what not to do. If you have stock or options from a company that’s about to go public, there may be
The Stock is Down, But You’re in a Post-IPO Lock-up
More companies entered the public markets in 2021 than any other year on record. From traditional IPOs or SPACs, and even direct listings, it was a banner year for exits. Unfortunately, the sharp pullback in the equity market to start 2022 is leaving employees and shareholders subject to a lock-up agreement in
5 Stock Option Mistakes to Avoid When Your Company Goes Public
Amidst a flurry of IPOs, many employees are experiencing their first major liquidity event from stock options. Unfortunately, for stock option rookies and veterans alike, there are plenty of potholes you’ll want to avoid when your company goes public. The crux of the issue boils down to planning, or lack
What Does an IPO Mean for Employees? What to Do When Your Company Goes Public.
What does an IPO mean for employees? And what should you do when your company is about to go public? For early-stage employees and executives with stock, a company going public can potentially be life-changing. For workers hired closer to the IPO, there’s still potential for some type of windfall. If