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Besides a salary, he has been offered around .2% of the total shares, vesting over 4 years.
Is that about the right amount? My gut feeling is that it is too low.
I'm wondering what "similarly early" employees have been offered at other startups. Examples would be welcome.
If not at least a few to several percent. If yes maybe 1-3 percent.
Profitable? Product market fit? Will the stock fit the requirements for Qualified Small Business Stock? This makes a huge tax difference. Early-excercise and 83(b)? Market rate salary or under market? Note market has 50% increased for startups the past year.
If you aren't getting a salary, but are working, you're a co-founder and the equity should be higher.
If they are getting a salary, that's probably right. The general rule is the first hire gets about 1% and it goes gown from there. But, the range for 1-10 employees is about 1-0.1%. It doesn't sound like much, but think about it this way. 0.1 percent, when the company goes IPO at a 10 billion market cap is probably 40-50 million dollars. If you aren't getting a salary, but are working, you're a co-founder and the equ…
If they are getting a salary, that's probably right. The general rule is the first hire gets about 1% and it goes gown from there. But, the range for 1-10 employees is about 1-0.1%. It doesn't sound like much, but think about it this way. 0.1 percent, when the company goes IPO at a 10 billion market cap is probably 40-50 million dollars. If you aren't getting a salary, but are working, you're a co-founder and the equ…
Have they raised a seed? If not at least a few to several percent. If yes maybe 1-3 percent. Profitable? Product market fit? Will the stock fit the requirements for Qualified Small Business Stock? This makes a huge tax difference. Early-excercise and 83(b)? Market rate salary or under market? Note market has 50% increased for startups the past year.
Can you quantify "a few to several" percent?
Thanks for the questions... answers below.
Raised a seed? Yes.
Profitable? He hasn't asked yet, but it seems that it should be profitable soon.
Product market fit? Good.
Tax stuff? We don't know right now. Anyway, we just want a ballpark comparison to what early employees have gotten at other companies.
Salary? Slightly under market rate.
If they are getting a salary, that's probably right. The general rule is the first hire gets about 1% and it goes gown from there. But, the range for 1-10 employees is about 1-0.1%. It doesn't sound like much, but think about it this way. 0.1 percent, when the company goes IPO at a 10 billion market cap is probably 40-50 million dollars. If you aren't getting a salary, but are working, you're a co-founder and the equ…