SoCal CTO

SEPTEMBER 27, 2011

I was asked by a reader how much equity he should give out to early employees and to service providers in a very early stage startup. Founders vs. Early Employees To help with this discussion, let me start with a definition of "early employee." If the company's valuation is $2 million, $90k is 4.5%.

Early Stage 391

Early Stage Equity CTO Hire Sweat Equity 391

Both Sides of the Table

JULY 22, 2010

Other founders, “as a privately held company we don’t disclose our valuation.&# Me, “dude, I’m not a journalist. I just want to figure out what a fair valuation is.&# I figured all the VC’s talked so we should. This starts with understanding how VCs and entrepreneurs often see valuation differently.

Valuation 405

Valuation Liquidation Preference Pre-Money Valuation Term Sheet 405

Steve Blank

APRIL 23, 2014

In response, venture capital firms like Sequoia and Andreessen/Horowitz are hiring new partners just to work with their portfolio companies and match them to corporations. VCs like acquisitions as much as IPOs because the acquiring companies often can rationalize paying large multiples over the current valuation of the startup.

Acquisition 332

Acquisition Intellectual Property Silicon Valley Startup 332

The Next Web

OCTOBER 7, 2013

They were referring to non-founder engineers, most commonly the first hire for technology businesses. However, at the very early stage, they are taking as much risk with their future as the founders. Every time a startup raises capital, all common shareholders are diluted. Engineer #1?

Engineer 129

Engineer Dilution Option Pool Vesting 129

www.entrepreneur.com

SEPTEMBER 22, 2011

When you're getting started, sweat equity is often a critical component of your negotiating leverage with co-founders, early stage employees and others who aren't paid market wages to help you grow your business. Sweat equity is just one component of early-stage valuation.

Sweat Equity 55

Sweat Equity Equity Fractional CTO CTO 55

www.quora.com

JANUARY 16, 2011

Smart teams understand quickly that all three skills are essential - if you can't recognize the need, you won't be able to hire for it or value it. The more structured the effort of the 'distribution' people will be, the clearer the communication with design and technical people and the higher mutual respect/valuation.

Technical Review 51

Technical Review Startup CTO Hire Cofounder 51