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I'm talking about the equity on day 1, not on exit day. But even on exit, the ratio is the same between founders and employees.
by gkmoyn 12y ago
I'm talking about the equity on day 1, not on exit day. But even on exit, the ratio is the same between founders and employees.
- kasey_junk 12y agoWell depending on the legal setup, the company has 100% of it's equity on day 1. Founders and employees both are given options to buy said equity. That ratio is not setup with the expectation that the founders will have 60-85% of the equity in the future.
- gkmoyn 12y agoSorry, my original point must have been very unclear. In a typical startup, the ratio of equity between founder and employee #1 might be 50:1 or even much more. I am always surprised that people sign up to be employees given how fast equity grants drop for every subsequent hire. And, I wonder if any company has tried more gradual equity drop-offs. For example, where the ratio between founder and early employee grants is < 2:1, for example.