EquityBee, an Israeli startup that provides employee-focused stock options funding solution, raised $55 million in new Series B funding. The round was led by existing investor Group 11, with participation from new investors Israel-based Greenfield Partners, as well as existing investors Battery Ventures, Local Globe/Latitude, Altair and ICON.
EquityBee’s total funding to date is now $83 million.
EquityBee says that its service helps to empower startup employees to exercise their stock options and participate in the success of the company they helped build. EquityBee’s Investor Network provides the capital that startup builders need to exercise their stock options and become shareholders.
We have all heard about stock options, but what are they, exactly? Investopedia explains that a stock option gives an investor the right, but not the obligation, to buy or sell a stock at an agreed-upon price and date. Companies offer such options to their employees as an incentive.
Nowadays, in the high tech sector, high level experienced computer and engineering professionals are kind of like free agents in baseball. They no longer take pride in working an entire career for one company in the way that people once did if they worked for big conglomerates like IBM and GM. So companies, especially startups, need to find a way to keep people around for as long as possible.
“And we are immeasurably proud to be the platform they are choosing to 1) better understand and 2) secure the financial future that they’ve earned, but may not be able to afford to access.”
This is where the stock option comes in. A person is offered more options the longer they stay with a firm. But these options can only be exercised at some future date. Startups offer options to employees with the expectation that the company will someday go public and have highly valuable stock.
“With so many exit events occurring, including acquisitions and SPACs, the startup equity system remains inequitable,” said Oren Barzilai, EquityBee co-founder and CEO. “We launched EquityBee to empower more employees to share in the success of the businesses they helped build. EquityBee will continue to provide them the tools required to better understand their earned options and the freedom to take part in augmenting their net-worth.”
Announcing our $55 million Series B led by Group 11, with Greenfield Partners and existing investors @BatteryVentures, @latitudevc, Altair, and @iconbuzz.
Thank you to everyone who took a leap of faith with us in pursuit of this ambitious mission.https://t.co/KLYFWpMlC6
— EquityBee (@EquityBee) September 29, 2021
In a blog post, the company talked about possible future IPO plans and how everyone seems to be going public through SPAC mergers these days. “During this unusually active time for high-growth and pre-IPO companies (IPO’s, acquisitions, and SPAC’s: Oh my!), startup employees’ equity is really heating up,’ read the post.