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Ask HN: Should I join startup for less-than-expected equity?

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Re: Ask HN: Should I join startup for less-than-expected equity?

#11

Post by Domenic_S »

mbesto wrote: post #6

Two key considerations: - Does the company (and it's investors/accelerators) have some sort of prestige that many people outside of the company would recognize? (i.e. if you put it on your resume will it look good later) - Ignore equity at this point (as the chances of it really paying off massive dividends are unrealistically low). Is $130k range in line with what you expect to earn? (note - $130k is comfortably liv…

> (note - $130k is comfortably livable in pretty much anywhere in the SF Bay area)

That depends on a ton of things.

Re: Ask HN: Should I join startup for less-than-expected equity?

#12

Post by frozenstorm »

Ultimately it needs to sit well with YOU, right?

Negotiate for more equity and weigh

- the final offer vs. what you think you could get in the rest of the market

- how much happier you'd be at the new gig vs. waiting around for another gig

I know nothing of how much equity is 'fair' for early hires but ultimately it's about where you'll be happiest, money / equity aside. Do what makes you happy and you won't have regrets.

Re: Ask HN: Should I join startup for less-than-expected equity?

#13

Post by ctide »

wheaties wrote: post #5

Assuming a $100M exit, no dilution, $150k/yr elsewhere, no gains from investing the salary difference, same salary raises per year, no additional equity. after 5 years, you net even. Anything longer than that you lose out. Anything shorter, you make more (sans taxes.) Seems like a risky bet to me.

And no dilution is not realistic given that they haven't even raised a Series A yet.

Re: Ask HN: Should I join startup for less-than-expected equity?

#14

Post by smt88 »

Equity is worth nothing, especially when it's that low. Don't even consider the equity when you make this decision.

Honestly, a healthy company that really believes in a strong exit in the future should be willing to match your previous salary. You should ask for $150k and skip the equity. If you work there for 5 years, an extra $20k/year is worth more than 0.2% in a $50M exit.

Re: Ask HN: Should I join startup for less-than-expected equity?

#15

Post by meritt »

The salary is low and the equity is hella low too. You'd do better to negotiate some sort of bonus structure instead of equity.

What do you want outside of financial incentive? Is it something you're excited about?

What's your background? A lot of us are hiring.

Re: Ask HN: Should I join startup for less-than-expected equity?

#16

Post by toomuchtodo »

Bahamut wrote: post #10

0.2% is way too low IMO - it's possible to get that type of equity from a post-series A startup. That salary is also low for SF based on what I've seen too.

What would be a "fair" amount for the first 10-15 engineers of an early-stage startup?

Re: Ask HN: Should I join startup for less-than-expected equity?

#17

Post by Domenic_S »

cuca_de_chumbo wrote: post #4

Also, I'd be leaving a job I really don't like at a Silicon Valley spinoff. $150K salary, 0.75% equity, shiny CEO with regular Fox-Business-News appearances, rising company notoriety, selling into a hot market. The company will never raise more "venture" funding, the parent will structure future injections as debt (at a reasonable interest rate, likely, but probably less onerous than VC). This current company has a h…

Are you there for the money or for the love? If money, stay and suck it up. If work represents a large portion of your happiness, bail.

2 years is not really a long time to live in suck-it-up mode, although your perspective will depend on which side of 30 you're on.

Re: Ask HN: Should I join startup for less-than-expected equity?

#18

Post by habosa »

I've never worked at an early-stage company, so I have more questions than answers. Isn't 0.2% basically nothing? Even if GoogleSoftBook buys the company right now for $100M, you get (at best) $200k. And that's not going to happen. Probably more money will be raised, your 0.2% will be diluted, and a $100M exit is rare. So you'll end up with less than 1yr of salary for all that risk and lost salary/benefits in the meantime.

I know it's not all about the money, but in this conversation we are only talking about money.

Re: Ask HN: Should I join startup for less-than-expected equity?

#19

Post by cuca_de_chumbo »

omgitstom wrote: post #8

Talk to them about it. Are you excited to join the company? Do you believe in their vision? Do you find excitement in the problems that they are helping their customer's solve? Do you feel good cohesion with the founders and the engineering team? Answering those questions are far more valuable in deciding to join a startup vs compensation. The compensation piece, if you feel is low, research and negotiate for it. If…

Their vision is great. They don't do rocket-science and they're not involved in social. Their market is positively boring, and it's something everyone needs, and nobody seems to have updated software addressing this market. Their approach requires a good core and also a lot of reliable peripheral development. I don't think there are any technical misgivings on their part toward me (I've proven my ability, programming-, vision-, and communication-wise), and I like working with them. I'm not sure we can settle on anything after the lowball though ... it betrays their lack of respect for the position or else for engineers.

Re: Ask HN: Should I join startup for less-than-expected equity?

#20

Post by cj »

$130k is well above average for a pre-funded startup in SF - Where are they getting the cash to pay you? Are they profitable?

0.2% sounds a bit low.

IMO it's not a bad starting point for a negotiation. If you're expecting something significantly higher, it might makes sense to look at later stage companies (or a company like Google or Facebook if you want to maximize your earning potential)

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