I have fully-vested options in a private company which expire in Dec 2023. A company has reached out to me saying they have a buyer for the shares. The shares are worth > $300k.<p>I'd like to sell because they expire in Dec 2023 and I don't know if there will be a liquidity event before then, however they want to take a 5% cut.<p>Is this a normal cut for a middleman in this type of transaction? Is there a way I can connect with a buyer directly to avoid giving a % to a middleman like this?
5% sounds ok. If <i>they</i> reached out to <i>you</i>. Then maybe you can negotiate it down some.<p>There are private equity markets. You might be able to talk to a broker at a company that handles private equity (JPM?) and explain what you want to do. I would think their cut would be lower than 5%, but I have no idea.
Just to add another perspecitve here - you might find out that middleman that you can easily access might find 5% of the deal not worth their effort.<p>The logic here is that prospective providers you will find are already busy with larger deals, as they are easy to find by all other market players.<p>(This is under the assumption that you don't have relationships with such middleman and would need to look for them)
> Is there a way I can connect with a buyer directly to avoid giving a % to a middleman like this?<p>Sure. Find the buyer yourself. If you can't or don't know how, then surely it's worth 5% to you. If you don't think it's worth it, then let the options expire.
I had shares pre-ipo worth $300k, then we ipoed and our stock price tanked while in lockup. Ended up selling at 30kish. If I could have taken liquidity pre-ipo I would have.
It depends on the company, if it’s a Databricks or highly coveted unicorn, then 1% is more than enough. It ids a struggling startup or no-name, then 5% might be fair