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So 10% of startups give out more than 1% of equity to a mid-level engineer ? Perhaps this is a small sample, but it sounds odd.
by dmark3 10y ago
So 10% of startups give out more than 1% of equity to a mid-level engineer ?
Perhaps this is a small sample, but it sounds odd.
- pyb 10y agoIs it odd that so few of them do ?
- dmark3 10y agoI would have thought that 1% is only for a first engineer, or an R&D manager and such. But perhaps things are changing, as candidates know how to ask the right questions.
- nevdka 10y ago44% of these startups had only Angel or Seed money. With strong technical founders, their first engineering hire could be considered mid-level.
- brianwawok 10y agoWhat should first and second hire get? 1 or 2% doesn't seem crazy after a seed round.
- taneq 10y agoAnyone who puts in sweat equity should get double digits IMO (unless the company has been around for years as a one man band, and maybe even then.)
- ptero 10y agoDouble digit ownership usually means the person is a cofounder. This question was about engineers.
- taneq 10y ago...who by definition aren't cofounders? Maybe I'm on the wrong site. O.o
- brianwawok 10y agoIf you join BEFORE seed money, and do a bunch of work for free, you can be a cofounder. If you join AFTER seed money, and get something like a market salary, you are an engineer. The gray area is the in-between places. If you join before seed money, but only work 1 hour a week (say to help out a buddy), are you a cofounder? I would likely vote no. Or if you join AFTER seed money, but work for 75% of market rate. Or 50%. At what pay do you appear to be a cofounder vs engineer?
- taneq 10y agoSo you're saying it is a definition issue. Regardless of what work you do at a startup, you are considered a "co-founder" if you put in initial sweat equity (ie. did work for free) but an "engineer" if you only joined after the company was funded and paying wages at market rates? As for the grey area, it seems as if common-sense should prevail but sadly that doesn't always happen so you always need a contract laying out exactly what each side gets, even for volunteer work. I seem to recall a story earlier this year (can't remember the company involved) where one of the founders' friends had helped out occasionally before they got funded, then the company got funded, ended up with a fairly large valuation, and the 'friend' reappeared and claimed that they were owed a significant share of the company.
- deleted 10y ago[deleted]
- krona 10y agoIf you think your first 3 hires deserve less than 1% then you probably shouldn't be hiring them. Alternatively, you gave too much equity to your investors. That's how I see it.