Dec '24 • General discussion
Stock Options vs. RSUs for Global Teams - A Practical Guide
Global equity compensation is complex, but critical for retention. Here's what's working in 2024.
Market Snapshot:
- 82% of tech companies offer equity to global employees
- RSUs gaining popularity (31% increase since 2022)
- Average equity grant: 0.01-0.5% for early employees
- Vesting: 4-year standard with 1-year cliff trending down
Stock Options vs RSUs:
Stock Options:
- Tax-friendly in US, Canada, UK
- Complex in Germany, Brazil, India
- Exercise price complications
- Better for high-growth potential
- Higher risk/reward
RSUs:
- Simpler global administration
- Immediate value
- Easier tax treatment
- Lower upside potential
- Better for stable companies
Country-Specific Challenges:
India:
- RSUs preferred
- Complex forex regulations
- Mandatory local custody
Germany:
- Options require special structure
- RSUs face social security impact
- 4-year vest maximum
Brazil:
- Currency controls
- High option exercise taxes
- RSUs more common
Implementation Guide:
- Choose instrument by country
- Set up local entity if needed
- Create documentation
- Brief tax advisors
- Train managers
What equity structure works best in your locations?
Real Data:
- Options: 65% acceptance rate
- RSUs: 89% acceptance rate
- Mixed: 72% acceptance rate
Share your experience below!
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Stock Options vs. RSUs for Global Teams - A Practical Guide
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