He's talking about early-exercise stock options vs instalment exercise stock options. Early-exercise let's you exercise the shares from day 1, before they're vested. It starts the clock running on long-term capital gains treatment, so you're more likely to qualify for that lower rate than if you exercise later.
You do have to pay for the shares out of pocket though so it's a risky move - could end up having paid cash for worthless shares, especially in an early stage company.
You do have to pay for the shares out of pocket though so it's a risky move - could end up having paid cash for worthless shares, especially in an early stage company.