> Rookies: Won’t always request equity, Experienced: More likely to request equity
Is this really true? I would think it's the opposite--the rookie has not yet felt the sting of swapping salary for worthless equity and would be more likely to value equity higher, whereas the veteran will know better...
The whole section on equity convinces me that I'm not joining a start-up any time soon. 1-3% for hires 1-5? Fractional percentages for everyone else? What a joke. That's what passes for early-stage equity? These are the people who are literally building your company. People seem to be falling for it though, and start-ups seem to have no trouble hiring, so who am I to argue?
The veteran knows that equity is something you can negotiate hard for and is very negotiable.
Regarding equity comp for early hires, presumably the founders have already done significant derisking by finding initial product market fit, secured initial capital, built a prototype, have buyer interest/commitments, etc.
Every time I see complaints about single digit % compensation, I wonder how many of the people complaining will go out and actually put in the work of validating a market and getting the initial momentum for sales and meeting 100 "investors" and "pseudoinvestors", put in years of networking to even be loosely connected to the money network, getting 90 rejections to get your first $500k, and the shitwork of setting up a corporation and doing all this work out of pocket in exchange for 10x the equity. I mean literally no one is stopping you from setting up a company that you own 100% of the equity of.
He's advocating for two classes of employees, those with and those without equity. That in my opinion is a recipe for failure. You will create a huge amount of resentment and pull apart a team that should be working together. Either everybody gets equity or nobody gets it.
Rookies
- Will settle for lower wage
- Might take longer to achieve certain outcomes.
- Will need training
So the conclusion that they are "cheaper" is not necessarily true if you factor in the extra time taken and training. Plus there is a very good chance that maintenance costs will be far greater once the project reaches some sort of maturity.
> Rookies: Won’t always request equity, Experienced: More likely to request equity
Is this really true? I would think it's the opposite--the rookie has not yet felt the sting of swapping salary for worthless equity and would be more likely to value equity higher, whereas the veteran will know better...
The whole section on equity convinces me that I'm not joining a start-up any time soon. 1-3% for hires 1-5? Fractional percentages for everyone else? What a joke. That's what passes for early-stage equity? These are the people who are literally building your company. People seem to be falling for it though, and start-ups seem to have no trouble hiring, so who am I to argue?