5 ms·

0.4% seems like nothing, too. That was very confusing to me.

by metamet 11y ago

jegutman 11y ago
I think 0.4% was just for the weekend worth of work. Like just think of it as everybody vested that much over the weekend so the company still had 96.4% unvested equity with very unclear ownership. That makes it seem a little more reasonable although not any less confusing.
jessedhillon 11y ago
40 basis points is an insanely large grant for 10-20 hours of work. They wanted 160 bps: 40 per person. At any normal company, you would have to work 4 years to get that amount. If you work at a company as engineer number 1-5, prior to any funding, you might expect 50-300 points, over 4 years, after working for a small salary, and under highly uncertain conditions. These expectations are ridiculously misaligned and totally unreasonable.
- nostrademons 11y ago
  Why exactly would you take 0.5-3% to work for a startup with no money under highly uncertain conditions, when you can take 33-100% of equity to found a startup with no money under highly uncertain conditions?
  - jessedhillon 11y ago
    > Why exactly would you take 0.5-3% to work for a startup with no money under highly uncertain conditions Because you believe in the team, the idea and the opportunity. > when you can take 33-100% of equity to found a startup with no money under highly uncertain conditions Those who can, will. But this guy wants to do neither. He wants 0.4% for 20 hours, and then he wants to walk away and let someone else build up the value of the company. Assuming his total stake is ~12%, that's equivalent to a demand for a 4 month vesting schedule with no cliff, for what? A weekend? He doesn't want to found a startup -- he wants to spend one weekend building a shitty prototype. He's not talking about being there when the thing goes live, fixing the broken deployment, troubleshooting the errors -- you know, the actual work which keeps the customers satisfied. He's talking about writing a model one time, and letting someone else take all the risk.
    - nostrademons 11y ago
      Well, if you can find someone who believes in your idea that nobody will pay for, the opportunity that you can't prove exists, and the team where some folks are taking 90%+ and others are getting 0.5-3%...more power to you. This is why startups find hiring, hard, though. These folks are a.) hard to find and b.) prone to leaving when they realize they're slaving away for virtually nothing. And IMHO, pretty much everything in this story is set up for failure. This is not how startups get founded. Actual startups get founded by a team working for equal or nearly equal shares, who do all of the work necessary to build something that people want, and then either take funding or use revenues to hire people once they can pay market-rate salaries. Startup Weekend is for meeting people. 0.4% equity deals with no salary are for wasting time on a lot of drama.
      - jessedhillon 11y ago
        > and the team where some folks are taking 90%+ and others are getting 0.5-3% I'm not sure how you keep missing this key part of the argument: 0.4% over 20 hours. I've italicized the part which I find ridiculous, so that you can better understand where I am placing my emphasis. Him wanting an equal share for an equal amount of work -- no problem. Him wanting to get a full, post-funding engineer's grant for 20 hours: wild overestimation of his own contribution.
        nostrademons 11y ago
        I'm missing that point because of this part of your original comment: > At any normal company, you would have to work 4 years to get that amount. If you work at a company as engineer number 1-5, prior to any funding, you might expect 50-300 points, over 4 years, after working for a small salary, and under highly uncertain conditions. It's not normal to work 4 years to get 0.5-3% equity, prior to any funding, under highly uncertain conditions. If the company is funded, growing quickly, and paying you market-rate salaries, sure, that might be fair. But if it's just a bunch of guys with an idea, you're pretty crazy to take that deal, and even crazier to keep working on it for 4 years. It's also not normal to take 0.4% for 20 hours of work, but that's largely because it's pretty crazy to actually expect to start a startup at Startup Weekend. Go use networking events to meet people, and then if you like & trust the people, make a commitment to working with them for a longer period of time for normal founder equity stakes.

0.4% seems like nothing, too. That was very confusing to me.

by metamet 11y ago

0.4% seems like nothing, too. That was very confusing to me.

I think 0.4% was just for the weekend worth of work. Like just think of it as everybody vested that much over the weekend so the company still had 96.4% unvested equity with very unclear ownership. That makes it seem a little more reasonable although not any less confusing.

jessedhillon 11y ago

40 basis points is an insanely large grant for 10-20 hours of work. They wanted 160 bps: 40 per person. At any normal company, you would have to work 4 years to get that amount. If you work at a company as engineer number 1-5, prior to any funding, you might expect 50-300 points, over 4 years, after working for a small salary, and under highly uncertain conditions. These expectations are ridiculously misaligned and totally unreasonable.

nostrademons 11y ago
Why exactly would you take 0.5-3% to work for a startup with no money under highly uncertain conditions, when you can take 33-100% of equity to found a startup with no money under highly uncertain conditions?
- jessedhillon 11y ago
  > Why exactly would you take 0.5-3% to work for a startup with no money under highly uncertain conditions Because you believe in the team, the idea and the opportunity. > when you can take 33-100% of equity to found a startup with no money under highly uncertain conditions Those who can, will. But this guy wants to do neither. He wants 0.4% for 20 hours, and then he wants to walk away and let someone else build up the value of the company. Assuming his total stake is ~12%, that's equivalent to a demand for a 4 month vesting schedule with no cliff, for what? A weekend? He doesn't want to found a startup -- he wants to spend one weekend building a shitty prototype. He's not talking about being there when the thing goes live, fixing the broken deployment, troubleshooting the errors -- you know, the actual work which keeps the customers satisfied. He's talking about writing a model one time, and letting someone else take all the risk.
  - nostrademons 11y ago
    Well, if you can find someone who believes in your idea that nobody will pay for, the opportunity that you can't prove exists, and the team where some folks are taking 90%+ and others are getting 0.5-3%...more power to you. This is why startups find hiring, hard, though. These folks are a.) hard to find and b.) prone to leaving when they realize they're slaving away for virtually nothing. And IMHO, pretty much everything in this story is set up for failure. This is not how startups get founded. Actual startups get founded by a team working for equal or nearly equal shares, who do all of the work necessary to build something that people want, and then either take funding or use revenues to hire people once they can pay market-rate salaries. Startup Weekend is for meeting people. 0.4% equity deals with no salary are for wasting time on a lot of drama.
    - jessedhillon 11y ago
      > and the team where some folks are taking 90%+ and others are getting 0.5-3% I'm not sure how you keep missing this key part of the argument: 0.4% over 20 hours. I've italicized the part which I find ridiculous, so that you can better understand where I am placing my emphasis. Him wanting an equal share for an equal amount of work -- no problem. Him wanting to get a full, post-funding engineer's grant for 20 hours: wild overestimation of his own contribution.
      - nostrademons 11y ago
        I'm missing that point because of this part of your original comment: > At any normal company, you would have to work 4 years to get that amount. If you work at a company as engineer number 1-5, prior to any funding, you might expect 50-300 points, over 4 years, after working for a small salary, and under highly uncertain conditions. It's not normal to work 4 years to get 0.5-3% equity, prior to any funding, under highly uncertain conditions. If the company is funded, growing quickly, and paying you market-rate salaries, sure, that might be fair. But if it's just a bunch of guys with an idea, you're pretty crazy to take that deal, and even crazier to keep working on it for 4 years. It's also not normal to take 0.4% for 20 hours of work, but that's largely because it's pretty crazy to actually expect to start a startup at Startup Weekend. Go use networking events to meet people, and then if you like & trust the people, make a commitment to working with them for a longer period of time for normal founder equity stakes.