--- title: "Employee Option Pool, Definition | MedTech Terms" description: "Shares reserved for issuance to employees as stock options. Plain-English Investment & Finance definition for MedTech teams, with examples and related terms." lang: en json-ld: | { "@context": "https://schema.org", "@graph": [ { "@type": "DefinedTerm", "@id": "https://medtechterms.com/terms/option-pool#term", "name": "Employee Option Pool", "description": "An option pool is a set-aside of common stock reserved for grants to employees, advisors, and directors as part of compensation. 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[Home](/) 2. / 3. [Terms](/terms) 4. / 5. [Investment & Finance](/terms?cat=Investment%20%26%20Finance) 6. / 7. Employee Option Pool [All terms](/terms) Investment & Finance [Startup Lifecycle](/ecosystems/startup-lifecycle) # Employee Option Pool Shares reserved for issuance to employees as stock options. Reviewed by [Christian Espinosa, Founder, Blue Goat Cyber](/authors/christian-espinosa) Last reviewed May 5, 2026 ## Definition An option pool is a set-aside of common stock reserved for grants to employees, advisors, and directors as part of compensation. Pools are typically created or topped-up before each priced round, usually pre-money - meaning founders bear the [dilution](/terms/dilution). ## What this means in practice Typical seed/ [Series A](/terms/series-funding) pools are 10–15% post-financing. MedTech companies with longer development timelines often need larger pools to retain talent through clinical and regulatory milestones. Common pitfalls - • Letting an investor demand a 20% pool top-up pre-money without negotiating it down based on actual hiring plan. ## Related terms Grouped by theme ### Editor's picks · Hand-selected related concepts [ Investment & Finance Capitalization Table(Cap Table) Ledger of all securities issued by a company and who owns them. ](/terms/cap-table)[ Investment & Finance Dilution Reduction in existing shareholder ownership when new shares are issued. ](/terms/dilution)[ Investment & Finance Vesting Schedule Timeline over which equity is earned by an employee or founder. ](/terms/vesting) ### More in Investment & Finance · Same category [ Investment & Finance 409A Valuation An independent fair-market-value appraisal of common stock used to set tax-compliant strike prices for employee stock options. ](/terms/409a-valuation)[ Investment & Finance Anti-Dilution Protection Adjustment that protects investors if the company raises a future round at a lower price. ](/terms/anti-dilution)[ Investment & Finance Bridge Round Interim financing between priced rounds, usually convertible. ](/terms/bridge-round)[ Investment & Finance Burn Rate Rate at which a company spends cash, typically expressed monthly. ](/terms/burn-rate) Cited by Where this term appears across MedTech Terms. Ecosystems (1) - [Startup Lifecycle](/ecosystems/startup-lifecycle) ## Primary references 3 sources Link health: 3 verified · last checked 2026-06-20 Carta· 1 NVCA· 1 SVB· 1 1. [1 Carta: option pool Verified Carta · carta.com ](https://carta.com/learn/equity/stock-options/option-pool/) 2. [2 NVCA Model Documents Verified NVCA · nvca.org ](https://nvca.org/model-legal-documents/) 3. [3 Silicon Valley Bank - Healthcare Reports Verified SVB · svb.com ](https://www.svb.com/trends-insights/) Inline markers like \[1\] jump to the matching reference above. Sponsor note ### Diligencing a MedTech cybersecurity posture? Blue Goat Cyber supports investors and acquirers with cybersecurity diligence on connected MedTech assets. [Book a 30-minute discovery session](https://go.bluegoatcyber.com/meetings/blue-goat-cyber/discovery-session) - No obligation - Expert-led from minute one - NDA available on request MedTech Terms is a community resource sponsored by [Blue Goat Cyber](https://bluegoatcyber.com). Definitions are independent of any vendor. On this term Category Investment & Finance Sources 3 Updated 5/5/2026 [Compare with another term](/compare?a=option-pool) Learn in 60 seconds Card Lesson Quiz Shares reserved for issuance to employees as stock options. - · Typical seed/Series A pools are 10–15% post-financing. - · MedTech companies with longer development timelines often need larger pools to retain talent through clinical and regulatory milestones. - · Pools are typically created or topped-up before each priced round, usually pre-money - meaning founders bear the dilution. Remember this Watch out: Letting an investor demand a 20% pool top-up pre-money without negotiating it down based on actual hiring plan. Related terms - [Dilution ](/terms/dilution) - [Capitalization Table(Cap Table) ](/terms/cap-table) - [Vesting Schedule ](/terms/vesting) You may also need Auto-suggested from Investment & Finance and shared keywords. - [409A Valuation ](/terms/409a-valuation) - [Pre-Money Valuation ](/terms/pre-money-valuation) - [Simple Agreement for Future Equity(SAFE) ](/terms/safe-note) - [Anti-Dilution Protection ](/terms/anti-dilution) - [Bridge Round ](/terms/bridge-round) - [Valuation Cap ](/terms/valuation-cap) [All Investment & Finance terms](/terms?cat=Investment%20%26%20Finance) MedTech Terms An authoritative, plain-language reference for the regulatory, quality, cybersecurity, and software terms that shape modern medical devices. 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