How much equity should an early stage employee get?

Steinberg recommends establishing a pool of about 10\% for early key hires and 10\% for future employees. But relying on rules of thumb alone can be dangerous, as every company has different cash and talent requirements. More important, Steinberg says, is understanding your hiring needs.

Do early stage startups pay well?

At an earlier-stage company, you can almost certainly expect a lower base salary than the industry norm, regardless of your previous experience. As the company matures, the salaries of all positions start to get closer and closer to market rate.

Should I take a pay cut to join a startup?

The answer to that question is yes – it is very standard. Your salary is important, but don’t neglect to consider other factors. A startup job offer often includes a salary, stock options (or stock), vacation time, and health/dental/401k benefits.

How much equity should I ask when joining a startup?

On average seed startups will issue from 2\% to 8\% of stock options (from the fully diluted shares). If a CTO is needed, he may get 1\% to 4\%. Other employees will typically split the rest, adjusted for experience, seniority, needs of the company, and skillset. You typically can ask for 0.25\% to 2.0\%.

How much do early startups pay?

On average, about 20\% of companies that make it to Series A successfully exit, which makes the expected value of the equity portion $21,000 per year. This means that, in total, the average early startup employee earns $131,000 per year.

Do startups negotiate salary?

Be aware that this isn’t a typical salary negotiation. It is near-impossible to negotiate your way to market rates; early-stage startups especially don’t have the finances for it and will probably offer you equity. That said, both your salary and equity packages have some degree of wiggle-room.

Should I take equity or cash?

Candidates can have very different needs and preferences when it comes to cash and equity. Cash has a guaranteed value (setting aside changes like inflation), while equity can end up being worth a lot more or less than anyone’s best guess. Cash is a commodity; equity in a company is not.

How much do early stage startups pay?

Do startups offer higher equity levels?

Seed-funded startups would offer higher equity—sometimes much higher if there is little funding, but base salaries will be lower. Leo Polovets created a survey of AngelList job postings from 2014, an excellent summary of equity levels for the first few dozen hires at these early-stage startups.

What is the role of a developer in a startup?

A developer’s job role in a startup is all about being curious with code, and a willingness to push boundaries to create a killer product. In the super early stages of a startup, the CTO might be responsible for the bulk of a product’s coding.

How do startup advisors get paid?

Startup advisor compensation is usually partly or entirely via equity. Typical equity levels vary depending on the value the advisor brings, the maturity of the company, and the level of their involvement, which can vary from occasional phone-calls or introductions all the way up to being a kind of part-time, hands-on member of the team.

Should you ask for more equity in a job offer?

Even if you’re satisfied with the company’s equity offer, it doesn’t hurt to ask for more. A study done by Linda Babcock found that on average, people who negotiated were able to increase their salary by over 7\%. That’s money or options you wouldn’t have otherwise—all for asking a simple question.