Compare ESOPs and RSUs to understand ownership, taxation, and long-term value.
ESOPs and RSUs are both forms of employee equity, but they work differently. Understanding the distinction helps you compare compensation offers more clearly.
ESOPs usually give you the option to purchase shares at a fixed price. RSUs are shares that are granted directly after their vesting requirements are met.
| Feature | ESOP | RSU |
|---|---|---|
| Ownership | Option to buy shares | Shares granted directly |
| Exercise price | Usually yes | Usually no |
| Common in | Startups | Large public companies |
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Beginner guide
Understand how Employee Stock Ownership Plans work, why startups offer them, and how employees benefit from equity.
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Dilution
Learn why ownership percentage changes after funding rounds and what dilution really means.
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Vesting
A simple explanation of cliffs, vesting periods, and how employees earn ownership over time.
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