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Ask HN: Appropriate equity share for founding team?
I have recently been approached by an early stage startup (still in stealth) with a solid idea and founders that have a solid track record.
I'm being asked to join the founding team. They use an open source framework that I've contributed to, a language I'm advanced with, and it sounds like a killer opportunity to buck the cog-in-a-wheel machine.
They are in stealth and haven't pursued venture capital yet, they want to build the product to a Beta release before seeking out funding. Their time line is one to two months before they go out and start pitching. So, they have no money to pay for work; the obvious compensation here is in equity shares.
Question to the commenters: does this sound solid? What kind of equity share is appropriate to be asking for as a developer on the founding team? What are your thoughts in general?
If there are any online resources that answer my questions I would gladly receive them; just can't find any since I don't know where to look!
Any input is appreciated!
- dasht 17y agoI'm not sure there is any good answer to your question but I noticed something about how you phrased it. You DID NOT say "a killer opportunity to get filthy rich". You DID say "a killer opportunity to buck the cog-in-a-wheel machine". Doesn't that answer your question? If you accept too small a stake, you will have no power of strategic influence over the firm - you will be a cog in a high-risk firm's machine. Why isn't your "ask" here "parity with the founders"?
- Ixiaus 17y agoA good way of rephrasing it, thank you. I've never dealt with the hurdles involved in working for an early stage startup... You are correct, too small a stake and I still have no influence (I suppose this would be a case to branch out into the Do It Yourself ethos of founding your own company). They are offering 1-2% equity share, per developer on the team... I suppose, in your words, that is less than parity.