// STRATEGIES
Equity Compensation Planning
Your equity comp is one of the most valuable parts of your financial life. It has the potential to be one of the most mismanaged parts too.
If you're a tech professional, equity compensation is likely a significant part of how you build wealth. Perhaps you're receiving RSU grants of $50K, $100K, or even +$1M per year. Perhaps you're facing potential ISO exercises with AMT implications they didn't see coming. Or perhaps you're kept up at night wondering whether to file an 83(b) election for the new stock options you just received.
Your equity compensation is doing its job. The question is whether you're doing yours.
// THE TENSION
Most tech professionals are financially sophisticated enough to know their equity comp matters — and honest enough to admit they're not sure they're handling it well.
This is the gap we see constantly: smart people making piecemeal decisions about stock compensation without a framework that connects those decisions to taxes, diversification, career timing, and long-term goals.
Each vesting event gets handled in isolation. Each liquidity event feels like a fire drill. And the nagging sense that you're leaving money on the table — or worse, creating an expensive mistake — never quite goes away.
// the landscape
It's Not One Problem. It's Five.
02
Equity compensation isn't a single topic. It's a web of interrelated decisions, each with its own rules, tax treatment, and timing pressure.
RSUs
Restricted Stock Units
The most common form of equity comp at large tech companies. Taxed as ordinary income when they vest — which means the tax bill arrives whether you're ready or not. The real complexity isn't the vesting; it's what happens next. Hold or sell? How much concentration is too much?
ISOs
Incentive Stock Options
Potentially powerful tax advantages — if you navigate the exercise timing correctly. Get it wrong, and the Alternative Minimum Tax may significantly increase your tax liability for that year. The spread between grant price and FMV at exercise is where most people either win big or learn an expensive lesson.
NQSOs
Non-Qualified Stock Options
Simpler tax treatment than ISOs (taxed as ordinary income at exercise), but the decisions around when to exercise, how many shares, and how to manage the resulting position are anything but simple — especially when balancing expiration dates against market conditions.
ESPP
Employee Stock Purchase Plans
Often overlooked, frequently misunderstood. The discount looks modest — typically 5–15% — but the actual return may be materially higher when lookback provisions allow you to purchase at the lower of two prices. The question most people skip: what do you do with the shares after purchase?
83(b) ELECTIONS
The 30-Day Window
A narrow window from grant to make a potentially high-impact tax decision on restricted stock or early-exercise options at startups. File it and you lock in today's value as your taxable amount. Miss it and you may owe taxes on a much larger number down the road. There's no undo button.
// THIS ISN'T DIY TERRITORY
The Cost of Isolated Decisions
03
The challenge with equity compensation isn't that any single piece is impossibly complex. It's that the pieces interact in ways that are hard to see — and expensive to get wrong.
// ISO + AMT
Exercising ISOs without modeling AMT exposure
// RSU + COST BASIS
Holding post-vest RSUs past a cost basis that's already deteriorating
// ESPP + TAX TREATMENT
Selling ESPP shares in a way that converts favorable long-term capital gains into ordinary income
// CONCENTRATION
Accumulating a concentrated position across multiple equity types without realizing your total exposure
These aren't hypothetical mistakes. They're scenarios we frequently encounter when reviewing a new client's equity compensation picture.
// the real question
It's not "do I understand my equity comp?" It's "am I coordinating it with everything else?"
The difference between handling equity compensation competently and handling it optimally is coordination: integrating exercise and sale decisions with tax planning, retirement goals, concentrated position management, estate considerations, and career timing. That integration is what turns a collection of one-off decisions into a strategy.
// HOW WE THINK ABOUT IT
Built by People Who've Lived It
04
Prospero's advisors are former tech professionals who have personally held and managed RSUs, ISOs, NQSOs, and ESPPs. We've sweated vesting cliffs and made exercise decisions under uncertainty. This isn't textbook knowledge — it's the kind of pattern recognition that comes from sitting on both sides of the table.
Each company has its own plan structures, vesting schedules, and liquidity dynamics — and we build strategies that account for those specifics.
Map your equity compensation across all types and grants, integrated with your tax situation, portfolio, risk tolerance, and goals.
Multi-Year Plan
Map your equity compensation across all types and grants, integrated with your tax situation, portfolio, risk tolerance, and goals.
Ongoing Coordination
Adjust as your compensation evolves, markets shift, and life changes — so your strategy stays current, not stale.
// the next step
If you're a tech professional making piecemeal decisions about stock compensation and wondering whether there's a better way, that instinct is probably right.
