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409A Valuation Calculator

409A FMV
$1
per common share
Preferred Price
$1
Last round price
Discount Applied
35%
DLOM discount
Revenue Multiple
5.9x
Implied valuation

Exercise Cost Analysis

Options to Exercise:10,000 shares
Exercise Price:$1/share
Total Cost:$8,710
Current Value:$8,710

Tax Impact Summary

ISO Tax Treatment
AMT Income:$0
AMT Tax:$0
Effective Tax Rate:20.0%

Company Valuation Inputs

$
17 months ago
$
% annually

Valuation Adjustments

35%
Discount for lack of marketability
For DCF valuation method

Valuation Methods Comparison

Last Round

40% weight
$50,000,000

DCF

30% weight
$47,609,289

Comparable

20% weight
$37,500,000

Asset-Based

10% weight
$25,000,000

Weighted Average Valuation

$44,282,787

Stock Option Analysis

$
For tax calculations

Projected Option Value Over Time

Tax Strategy Comparison

Early Exercise (Now)

Exercise at current 409A FMV

  • No immediate tax (ISO) or minimal spread (NSO)
  • Start capital gains holding period
  • Risk: $8,710 cash outlay
  • File 83(b) election within 30 days

Exercise at Liquidity

Wait until acquisition or IPO

  • No upfront cash required
  • Higher tax on larger spread
  • NSO: Ordinary income tax on full gain
  • ISO: Potential AMT issues

Exercise After Vesting

Exercise vested shares periodically

  • Moderate cash outlay over time
  • Manage AMT exposure (ISO)
  • Some long-term capital gains
  • Balance risk and tax efficiency

Key Insights & Recommendations

  • Current 409A valuation is 87% of preferred price
  • Exercising 10,000 options requires $8,710 in cash
  • AMT exposure of $0 may trigger $0 in additional tax
  • Break-even stock price: $1 (including taxes)
  • Consider early exercise if you believe in >3x growth and can afford the cash outlay