How much does a core team member gets in equity in an early stage startup?
javajack
Student
2 months ago
Don't expect much, if the founders raising money and they're seasonal or second time founders.
Ensure you get better cash. And negotiate hard if you are dealing with first time founders.
If you are going to hustle equal or more than founders ( I bet, you will ) then it's better you get all your legal work about equity sorted before joining.
After you are trapped, time will flow at the speed of light and owners conveniently ignore all your negotiating power.
EarthDragon
Stealth
2 months ago
That’s true and the leech like founders will squeeze you out :)
Also I am infusing the capital plus have worked for an year without drawing any salary
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Negotiate for a 7-10% equity atleast . You are creating a base for the startup , make sure you feel secured and motivated at the same time . If you work this hard , you might reach that $ milestone anyways within a few years. Tell the founder you are working because you are genuinely interested in the idea and to be able to give so much , you must get your share
7-10%... that's not how it works at an early stage funded startup
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Usually for a team member joining the core team when the size of the startup is less than 10, 0.2% to 0.8% is the ballpark.
For a business size of 11 to 50, the magnitude of ownership decreases by a decimal point to the left.
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Maverick_vs
Stealth
2 months ago
You should get fair salary but you have to understand It's the founders who takes all the risk. Specially the first time founders risk everything and you don't know the trauma of running a business where everything is at stake. For you it's just a job. You can get another but if the company doesn't make it big. It's a very big setback for the founders.
Equal amount of risk I have taken by not withdrawing salary for a year ?
Maverick_vs
Stealth
2 months ago
You deserve the reward for what you bring to the table. Discuss with your founders what they have in mind for your future.
EarthDragon
Stealth
2 months ago
You’re taken for a ride. All that’ll be left would be burnt hands and a wounded soul :)
Sunk cost
KookyAcid
Stealth
2 months ago
For core members it's in .5 to max 5 depending upon the startup's dependency on you. If you can be replaced why would founders pay you better equity.
Always ensure the things are documented and are on paper. Else you will end up wasting time.
Megamind007
Stealth
2 months ago
What are they even building? Will it sustain in future? Will it explode and is the market pull or push? If it is push, are you confident in the founders to lead? Their vision??? SaaS or Consumer market? Because the answer to these questions will make ESOP either extremely valuable or unworthy. You are going to give all of your might and you should definitely understand all of these. Then it will be clear.
Think of these questions and determine if you should draw salary or be happy with ESOPs and negotiate over that. Ask ESOPs worth your current value and get in written that if you grow and make the following milestones you will get following equity on top of it.
P.S. Everyone gets different ESOPs as per their value and negotiation. True founders who are visionary will offer Salary( if they can) and put ESOPs to earn in future to stick throughout the journey.
KaleidoscopicCommander
Stealth
2 months ago
What s your mind I will think be there ve i hope me
You should check this out -
https://youtu.be/2atzUh5NzzI?si=dmczOKLI4vAKBGEo
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