Securities & instruments
What is Warrant?
A right (not obligation) to buy stock at a specified price within a specified period - like an option, but typically issued to investors or partners.
Warrants are option-like rights to purchase stock at a predetermined strike price. They differ from employee stock options in two ways: warrants are usually issued to investors, lenders, or strategic partners (not employees), and they're typically longer-dated (5-10 years vs 10 years for options). Common scenarios: venture debt providers receiving warrants as 'kicker' compensation, accelerators receiving small warrants on companies they support, or strategic partners taking warrant positions instead of cash.