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Comment by a-priori | Hacker News Reader

RSUs are always granted as a number of shares. It's kind of the point of them, so the employee benefits from stock appreciation since their hire date.

However, in offer paperwork, it will sometimes be stated as a dollar value. This is for two reasons: the first is that RSUs need to be approved by the board at a meeting, which can happen some time after the hire date, at which time the dollar value is converted into shares.

But the main reason is that it makes it easier for the candidate to understand the value of the RSUs, and lets the company then talk about the total compensation and try to treat RSUs like cash in that discussion.

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Since there are comments saying things like "I've never seen them based on dollar value":

My well known company has always granted stocks based on dollar value. Many employees incorrectly thought it was "number of shares", but if anyone actually asked the manager who decided how many shares they would get, the answer was always "We're given a dollar budget in shares to allocate amongst our reports - the system then converts that dollar amount into shares based on the stock price at the time."

So if our company has always done it this way, I suspect many others also do it this way.

I think people in this thread might be talking past each other.

I get a manager could be told “you have $500k of 4 year grants to give out this year”. He tells an employee “you’re getting a $100k 4 year grant.” Stock is $100 today, so that’s 1,000 shares, or 250 per year.

A year passes. Stock goes to $50. Here’s my big question: Are they still getting 250 shares this year from that grant (now with a value of $12,500) or are they getting $25,000 which is now 500 shares?

The first one is what I mean by it being set in stock and it’s the only thing I’ve seen. I get that it was calculated in dollars at the beginning, for budgeting purposes.

Something in between is what I think Coinbase and Stripe are doing, which is 1 year grants. I think they’re still frozen to number of shares at the beginning of the year (even if it’s calculated in dollars).

Ah I get it. Yes, even in my company, it would still be 250 shares.

I think some of the confusion is from somebody claiming they are granted RSU's based on dollar value, and then that dollar value is converted to shares at the 1-year vesting cliff. That is incredibly weird.

Offer letters having dollar values for the share grant at the time is normalish.

Yes, a place I'm familiar with gives you a dollar amount. At RSU distribution time (i.e. when you actually receive them, not at offer-time), you will receive that dollar amount of shares, regardless of each share's value. TBH I'm not sure why they structure it this way (maybe fewer taxes than payroll? or looks better on a balance sheet, somehow?).

One possible reason is that they can pretend it’s not costing them anything when they report “adjusted” earnings.

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