You are talking hypothetically. What post consolidation dilution? Are you assuming that future incoming employees are going to be granted options at multiples of what prior employess have been granted? Don't forget that all existing options are consolidated as well - anybody with 100,000 current options would get 20,000 at 5 times the strike using your 5 to 1 math (ie 100k $1.50 options become 20k $7.50 options). The cost to excercise the 20,000 consolidated options is the same as the cost of excercising the 100,000 pre-consolidation options. I say it again- Economically there is no difference! Whatever economic dilution there will be is the same absent a shift in remuneration policy.