CHALK TALK WITH CARINE
409A VALUATION MUST-KNOWS:
THE DO’S AND DON’TS
Upon learning from legal or tax advisors that to grant stock options a 409A valuation is needed, the next logical question startups and founders ask is “Okay, so what is a 409A valuation?” A 409A valuation is an independent appraisal of the fair market value (FMV) of a private company’s common stock. This valuation, required due to section 409A of the IRS’ internal revenue code (IRC), determines the strike price for option recipients to purchase a share. You can’t offer options that comply with rule 409A without knowing how much a share is worth. So, if you want to offer stock options, you’ll need a 409A valuation.
Key questions that will be discussed:
- What are 409A valuations? Why and when do you need them?
- How do liquidity programs impact them?
- What is happening with company valuations in the current market and why we should care?
Host
Carine Schneider
President
AST Private Company Solutions
Carine Schneider, FGE is an experienced Fintech executive and leader in the private market community. She is the president of AST Private Company Solutions, which is the maker of the next-generation equity management platform and cap table software team at www.astrella.com. Carine was formerly the president of Nasdaq Private Market, has been the CEO of numerous startups, and prior to the startup world, she was a partner at PwC.
Guest
Trent Read
Principal & Co-Founder
Economics Partners
Trent Read is a Principal and a Co-Founder at Economics Partners, a business valuation, strategic consulting, and international transfer pricing firm. He’s been the CFO of two successful, venture-backed startups that he helped grow, secure growth capital, and sell to public companies. He was also an investment banker for six years and worked in finance with two Fortune 100 companies. He received both his BA and MBA from Brigham Young University.