France improves stock options policies for startup employees

A couple of weeks ago, France’s digital minister Cédric O announced some changes when it comes to stock options in France. President Emmanuel Macron is going to talk about the new policy today ahead of the World Economic Forum.

While I don’t want to be too technical, here’s a quick overview of the changes.

First, the price of stock options (also known as BSPCE in France) won’t be based on the same VC-determined valuation. Let’s take an example — a VC fund invests in a Series A round, valuing the company at €12 million.

If you join the company after, you can get stock options based on a lower valuation, which increases the chances of higher returns. Going forward, there will be a different valuation for employees getting stock options.

Second, if you work for a foreign startup but you’re based in France, you couldn’t receive stock options. For instance, if you’re a Citymapper employee — a startup that is headquartered in London — based out of the Paris office, you could forget about stock options. Employees based in France can now receive stock options even if the company isn’t incorporated in France.

Third, the French Tech Visa now also works for foreign companies with an office in Paris. If you work for Berlin-based N26 and you want to hire a great Brazilian data scientist in your Paris office, you can now go through the fast-track visa process for startup employees.

Last year, VC firm Index Ventures coordinated an effort to overhaul stock option policies across Europe by lobbying policymakers. Hundreds of tech CEOs have signed the ‘Not Optional’ letter since then.

According to Index Ventures, Germany, Spain and Belgium are the lowest-ranked European countries when it comes to the regulatory framework around stock options.

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