10/20/2026
Three things founders often assume about equity before Series A:
Myth: Options are free because no cash leaves. Reality: ASC 718 expense and dilution still hit reporting.
Myth: Our 409A covers the accounting. Reality: 409A supports tax and option pricing; ASC 718 needs grant-date fair value under GAAP.
Myth: Every founder should file an 83(b) on their options. Reality: §83(b) covers certain property transfers subject to vesting, not normally unexercised options.
A 409A file, a cap table, and the general ledger must tell the same story.