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Negotiations boil down to "are you actually willing to walk away if you don't get X". Power goes to the most willing to walk.
But leaving would mean that the entire deal would fall through, which is no longer an option.
I have no experience of your situation but I think you should perhaps start by negotiating your level and title as an employee as part of the acquisition. I suppose that what's achievable is correlated to the size of your startup. Whether you join as, say, Director or VP will have a direct consequential impact on your salary (you'll automatically fall within different compensation bands) but also on your standing wit…
Thanks for the advice! Very helpful. Do you have any general tips for negotiating a salary?
Earlier quoted context omitted.
You'll have a good chance of getting "we can't pay that, sorry, see you" back. Then if you actually want that job you'll have to walk it back and negotiate down. Not always possible, so it may not be the greatest idea to start at x2.
If they don't counteroffer then they don't want you. This is a negotiation. The starting offer is about anchoring. Neither side should expect the starting offer to be accepted immediately. If it is accepted then one side didn't anchor properly and lost the negotiation. Start with a number you think is too high but still leaves room for the company to negotiate down to an acceptable number for you. I usually don't go…
150% is far more reasonable than 200%. Let's say you won't take below 100k, Co. won't take above 120k, you offer 150k. From the Co.'s perspective, that's 25% difference, it's worth negotiating. If you offer 200k, that's 66% off what you'll take. Co.'s probably thinking, okay, this guy will take 160 maybe 140 but no way they'll really think they can negotiate down to 120.
At bigger companies there aren't incentives to spend tons of time negotiating a candidate down to the top of your acceptable range, so even if they think they can get you down 80k you're out.
You don't counteroffer a candidate you can't afford. And I think you understand intuitively 200% is too much, which is why you go 150%.
Earlier quoted context omitted.
If they want you, they want you. If they balk, then you know where you stand and that information is probably valuable.
It's definitely acqui-hire, too. That makes sense! Thanks for the perspective. I'm just wondering what arguments to bring to these types of conversations.
A negotiation is not an argument. It is an agreement.
Either you reach one or you don’t.
And if you agree to something that you don’t want to live with, you’re already halfway out the door.
Ask for double what you want, to start.
I don't want to be cheeky with them, but at the same time I expect something more than industry standard. The problem is that I have never worked as an employee before and salary negotiations are new territory for me.
- Cash Comp - What you are actually paid every 2/4 weeks.
- Sign On Bonus / Retention Bonus - Paid lump sum (or over time) for joining the acquirer.
- Benefits - 401K / HSA / Health / Medical / Dental, individual or dependents.
- Equity - Assuming your equity will be bought out (cash) or rolled into new equity or both.
- Equity Vesting Schedule (AKA Golden Handcuffs) - On what terms does it vest? What are the strike prices for options?
- Non-Compete - May be part of the acquisition for a period of time.
- Termination - Golden parachute or termination without cause and you lose your equity?
Next, figure out what they can give you on each of these compensation areas. This is the negotiation part.
- Maybe they are in a cash crunch and they can give you really generous stock grants?
- Maybe they are out of options in the pool and need to refresh it, so they'd rather give you cash.
Objective of negotiating is finding a solution that works for both parties. You will have a much better time if you focus on what works for them, and toy around with your preferences.
Every negotiation that starts with "Take them for all they are worth" sets the wrong tone.
Negotiations boil down to "are you actually willing to walk away if you don't get X". Power goes to the most willing to walk.
Earlier quoted context omitted.
You'll have a good chance of getting "we can't pay that, sorry, see you" back. Then if you actually want that job you'll have to walk it back and negotiate down. Not always possible, so it may not be the greatest idea to start at x2.
If they don't counteroffer then they don't want you. This is a negotiation. The starting offer is about anchoring. Neither side should expect the starting offer to be accepted immediately. If it is accepted then one side didn't anchor properly and lost the negotiation. Start with a number you think is too high but still leaves room for the company to negotiate down to an acceptable number for you. I usually don't go…
So why not skip that step and start more reasonable?