Congrats! Having worked at a company that went public about 6 years ago, I've been through quite a lot of ISO stock events. I can offer some perspective on it.
First, keep in mind that if you leave your company, you must exercise your options or they will disappear. Usually within 30-60 days. So you probably wont really be able to defer the tax hit from your last W-2 year. Perhaps you could get around this if you left in a December, I suppose... but even still I'd read up on the rules around that.
While ISOs are generally tax favorable (taxed on sale vs. taxed on exercise), if you exercise and hold the stock to try to lock in long term capital gains, you WILL be hit with AMT for that year, which will be sizable (for me, it was tens of thousands).
Another thing to consider is that the stock may not retain its value or even go up. I tried exercise and hold on the first year and got hit with a lot of AMT, and the stock didn't go up. Darn. Some folks will exercise near the beginning of the year, and make a decision on how much to unload at the end of the year to offset AMT. But you're probably subject to lock up periods and there's not a lot of flexibility on when you can sell, so that doesn't always work out.
The strategy I ultimately decided on is "same-day exercise and sale" in as much tax liability that you're willing absorb throughout the year for equal dollar increments at each available trading window. Holding is essentially timing the market, something I imagine most FI types would turn their nose up at. It's easy to get personally invested in the success your employer and not make the kind of dispassionate clinical decisions that ultimately would be the more beneficial ones.
The advice I kept hearing was: think of it as a cash bonus. If you got all that money in cash, would you immediately turn around and buy up your company's stock? Probably not. I'm willing to bet you'd throw it all in Vanguard or similar. Yes you will see some large tax bills, but hey, those are the rules. It's still free money.
One thing I didn't expect about ISO sales, at least in my case, is that they get reported as W2 compensation, not capital gains... if you hold for less than a year. So offsetting those sales with, say, some harvested tax losses doesn't work.
Being a part of a newly publicly traded company is really an emotional roller coaster ride. You'll find yourself obsessing and puzzling over market fluctuations. That being said, peace of mind has a lot of value. I never regret the stock I sold. I often regret the stock I held.
