> Let’s say that you want to hire a top software engineer and are competing with equity grant offers from Facebook and Google where the value of the grant is $1

> Let’s say that you want to hire a top software engineer and are competing with equity grant offers from Facebook and Google where the value of the grant is $1mm. If you have a current valuation on your company of $10mm, then you have to offer 10% of the company to compete for that engineer. I am not saying the engineer isn’t worth it. She is. 1. Facebook and Google are publicly-traded. $1 million in equity at a publicly-traded company is not the same as an equity grant at a startup that is theoretically worth $1 million based on the valuation given to the startup by venture capitalists in its last round. The startup's equity might never be liquid and it's far more vulnerable. 2. Most startups do not have to compete with Facebook and Google on compensation. Most of them can't really afford to. The truth of the matter is that as a startup, if you can't get folks excited about working for you without matching the dollars offered by the richest tech companies, there's something wrong with your value proposition or you're trying to recruit the wrong people. 3. What's the difference between a "top software engineer" and a "software engineer"? Different companies have different needs. This idea that all startups need the best of the best (i.e. the person who Facebook and Google are battling for) and that you can't put a limit on the worth of an engineer ("I am not saying the engineer isn’t worth it") is ridiculous.