Option Pool General

What is an Option Pool?

Your option pool reflects the number of shares the company has set aside to grant as share options to employees, advisors, etc. You usually create an option pool (either pre or post-money) as part of a funding round. Your option pool will appear in your cap table in a grey colour. The option pool is not under a defined share class, as you can determine the share class of the share options when you grant them.

Option Pools are nearly always created pre-money in a funding round meaning it's only the existing shareholders who get diluted by the options pool. This is generally what the new investors are going to insist on (you're promising them a particular % of the company for their investment, if you then tell them, oh, it's actually 10% less than that, you got diluted already, well, that's not something they're generally expecting, unless by prior agreement). Here is an interesting article on how to size an employee option pool.