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> equity in early stage startups has an exact dollar amount attached to it No - at least in the US, you avoid pricing your start up until it's necessary, in or
by gkop 9y ago
> equity in early stage startups has an exact dollar amount attached to it
No - at least in the US, you avoid pricing your start up until it's necessary, in order to plausibly say the equity is worth as close to $0 as possible, so equity grants result in the smallest possible tax liability. In practice, this means raising early rounds in convertible notes, which don't require the company be priced.
- curun1r 9y agoAt that stage, you're not taking a salary, so your point is moot. This is about startups that can afford to pay founders a salary, and those startups have either raised money at a specific value or are profitable enough that you can't claim the equity is worth $0.