AMT rules requiring you to report exercised options as income are damn-near criminal, IMO. If you can early-exercise at grant time, file your 83b election, and avoid taxes, great. But if you can't afford it, and want to see anything from that equity, you are stuck staying at that company at least as long as the first liquidity event.
I think the takeaway here is that you should probably not work at a startup if you don't have the cash to early-exercise your option grants (or work there, but value the equity portion of your comp at $0 and be ok with that). Obviously you didn't know or consider that at the time, which is a pretty common level of understanding, I think, one that I shared when I was first dipping my toes into the startup pool myself.
On the plus side, I think financial education and knowledge around startups has gotten leaps and bounds more prevalent over the past dozen years or so. Fewer people will experience the same situation you do, because they'll know not to get into it in the first place. And once enough people understand the implications of these unfair practices, they will have to change if startup founders and investors want to continue to attract talent.
I think the takeaway here is that you should probably not work at a startup if you don't have the cash to early-exercise your option grants (or work there, but value the equity portion of your comp at $0 and be ok with that). Obviously you didn't know or consider that at the time, which is a pretty common level of understanding, I think, one that I shared when I was first dipping my toes into the startup pool myself.
On the plus side, I think financial education and knowledge around startups has gotten leaps and bounds more prevalent over the past dozen years or so. Fewer people will experience the same situation you do, because they'll know not to get into it in the first place. And once enough people understand the implications of these unfair practices, they will have to change if startup founders and investors want to continue to attract talent.