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  • Matt DeLong

What are the best ways of selling private stock or private stock option

if leaving a bootstrap startup?

You should have a conversation with any of the other shareholders to see if they are interested in your stock.


Most shareholder agreements have a “first right of refusal” meaning that the existing shareholders have a right to buy your stock before any new shareholders come to the table. Here is my recommendation:

  1. Find a buyer at a price you are comfortable with.

  2. Take a written offer to the existing shareholders to see if they are interested at that price, give them 30–90 days to consider your offer (whatever your shareholder agreement states).

  3. Sell to existing shareholder or if no existing shareholders are interested, sell to the new buyer you identified in step #1.

  4. You’re done.

I’ve seen #2 work on occasion, but never seen #1 work — EVER. Private stock is highly illiquid (hard to sell) so you should be prepared to A) Get squeezed on your price (accept less than you think it’s worth). -or- B) Keep the stock, don’t sell, knowing it could become worthless someday. Also, the higher your total ask, the less buyers there may be (a $150k stock purchase has more buyers than a $150m stock purchase).


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