Animal Spirits Podcast Talk Your Book: Investing in Start-Up Equity
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Oct 18, 2025 Dave Thornton, Co-founder, CEO, and CIO of Vested, dives into the complexities of helping startup employees exercise options. He explains the common challenges faced by employees, particularly the 90-day exercise problem. Thornton discusses Vested's innovative funding model that allows employees to avoid losing shares. He also explores how Vested uses machine learning to assess fair market values of private companies and the importance of diversification in venture capital investments, all while navigating the competitive landscape of employee liquidity programs.
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Underserved Market Among Rank-And-File Employees
- Vested targets rank-and-file startup employees who lack capital to exercise options and are otherwise underserved by banks.
- They provide capital by buying a portion of future shares to cover employees' exercise costs today.
Pivot From Education To Capital Provider
- Vested began as an education site and pivoted after users repeatedly asked for capital to exercise options.
- Most inbound requests were from ex-employees with 90-day exercise clocks and small funding needs.
Buy Minimum Shares To Enable Exercise
- Buy the minimum number of shares necessary to fund the employee's full exercise so you minimize dilution.
- Use a forward-contract style purchase and collect delivery when transfer restrictions lift.