The true value of stock in a high-growth company like Wise
At Wise, all our employees have a share in our mission and the responsibility to make our product a success. Stock is one of the ways we share the value of our growth and is a key part of our compensation package.
We’ve grown into a multi-billion dollar company with over 10 million customers in just ten years. And our hyper-growth isn’t coming to an end anytime soon. So what does this mean for our stock offer? If you’re thinking of joining Wise, this blog answers your most frequently asked questions.
This guide covers:
- What stock options and Restricted Stock Units (RSUs) are
- The value of Wise stock
- How exercising stock options works in practice
- Stock FAQs
- Glossary of terminology
Take a look at this video to get an overview on how stock works at Wise. For more information, check out the guide below.
First off, what are stock options?
Note: We offer stock options to all employees except US taxpayers. If you’re a US taxpayer, we offer Restricted Stock Units. Skip to the section below to read more about these.
Stock options are a right to buy and sell a specific number of shares in a company’s stock at a predetermined price (strike price1) over a fixed time period (vesting period2).
Ownership of a company is broken down into shares. When you receive shares, you become part-owner of that company’s success.
A share in a company is like one slice of a cake. All slices are equal. A stock option is the chance to buy a slice of that cake at an agreed price at some point in the future.
At Wise, the amount of stock you get is set by your role and level. As you progress in your career and increase your impact, you can get more stock options.
What are Restricted Stock Units (RSUs)?
Note: RSUs are offered to US taxpayers only (no matter where the job position you apply to is located).
RSUs are similar to stock options but are a more tax-efficient way for US taxpayers to get their stock package.
Employees don’t need to purchase the slice of cake (RSU) like they do with stock options. Instead, the RSUs are automatically converted to shares and given to employees over time once they have vested.
What’s the value of Wise stock?
Wise became a publicly listed company³ on 7 July 2021. Our stock’s value is driven by how much our investors are willing to pay for each share on the stock market.
In May 2019, Wise raised an additional $292 million through a secondary sale at a valuation of $3.5 billion (making us the most valuable FinTech startup in Europe at that point!). In July 2020, we had another secondary sale raising a further $319 million, with the valuation increasing to $5bn. That’s 43% growth in just a bit over a year.
Wise listed on the London Stock Exchange on 7 July 2021 at a valuation of $11 billion, so our value has doubled in the last year. You can check the current value of Wise shares on the London Stock Exchange.
How does it all work in practice?
Stock is a long-term incentive — we want our employees to stick with us on our mission. So we have a 4-year vesting schedule with a one year cliff4. This means you have to work at Wise for at least one year to have any vested stock that you can exercise and/or sell at a later day.
The life cycle of stock options
The life cycle of Restricted Stock Units
Let’s imagine a potential scenario
Sam was hired in 2019 and was granted £15,000* value of stock with a strike price of £0.00 per share. The indicative value of a share at the time of grant was £30, so Sam was granted 500 stock options (15,000/30).
In 2021, Sam vested 50% of their stock options and decided to exercise and sell 20% of these. They’d vested 250 stock options at the time so they sold 50 shares.
In 2021 each share was worth £70 – they’d more than doubled in value! This meant that when Sam sold their 50 stock options, they received c. £3,500 (before tax and other costs).
*The total amount is without tax — taxes will always depend on the country the employee is located in.
Note: All the numbers in the above example are hypothetical.
Other Frequently Asked Questions we get about stock
How much stock do you get?
This depends on your role and responsibilities. If you’re applying to Wise and are successful (congratulations!), you’ll learn about the amount and expected value of your package when you get your job offer.
How often does Wise grant stock?
Our stock package is for 4 years. We don’t do annual stock grants.
Do you get more stock if you’re promoted?
The amount of stock given is set by role and level. So if you progress in your career and increase your impact at Wise, then sometimes more stock is granted, depending on your role and responsibilities.
When can you sell your stock?
You can exercise and sell your stock options as soon as they have vested. If you have RSUs, these will automatically be delivered to you as shares as soon as they vest. At that point, you’ll be able to sell them.
How long do you have the stock for? Can I keep it after I leave Wise?
Stock grants are for ten years. When you pass your one year anniversary, you can keep your vested stock options, even if you leave Wise. If you leave Wise within your first year, you’ll lose your stock options.
What about taxes and stock?
Stock options are usually taxed in a similar way to other taxable income. The taxing point can be at grant, vesting, exercise, sale or when changing your tax residency. In most countries, you don’t have to pay any tax until you can exercise and sell your stock options. Exceptions can happen when you relocate or do remote work.
The tax an employee has to pay depends on their tax residency, so it’s worth doing your homework. It can get a little complicated sometimes, and that’s when it’s time to see a tax advisor.
Do I have to buy out my shares if I leave Wise?
No. You’re able to keep all your vested options when you leave. You can exercise and sell them at any point before their 10 year expiry date. You won’t be able to keep any unvested options or RSUs when you leave.
1 Strike price (also known as the exercise price): A fixed price that the owner of a stock option (a Wise employee) can buy or sell an option.
2 Vesting period: The time an employee has to work for the company to earn the stock options or Restricted Stock Units. At Wise, we have a four year vesting period, which means our employees earn their stock option/RSU package incrementally over four years.
3 Publicly listed company: A public company sells all or a portion of itself to the public via an Initial Public Offering (IPO), which means that shareholders have a claim to part of the company’s assets and profits. Wise became a public company on 7 July 2021.
4 One year cliff: To earn any stock options from working at Wise, our employees need to work here for at least one year. After a year, they’ll have vested the first 25% of their option/RSU package. After this cliff, the rest of their package will be vested incrementally until their four year Wise anniversary.