Both Sides of the Table

MAY 9, 2018

I also had to negotiate a follow-on round at a portfolio company because new investors were trying to force a bit option-pool top-up that would dilute the founders and existing shareholders and existing investors were fighting over prorata rights. Last time we met I didn’t have my CTO with me. Some were interesting, some weren’t.

Software Review 381

Software Review Churn Rate Due Diligence New York 381

Startup Professionals Musings

AUGUST 24, 2016

The CTO of many technical startups was the original founder. Of course, all co-founders need to remember that allocated percentages will be diluted as Angel and VC investors are brought in. Keep your wits about you to make sure that dilution is done equitably and evenly.

Equity 120

Equity Cofounder Technical Cofounder Intellectual Property 120

Startup Professionals Musings

APRIL 23, 2012

Who will be the CEO, CFO, and CTO? All partners should never forget that their allocated shares are only the beginning, and will be diluted proportionately when outside funding is later required from angels or venture capitalists. The next big challenge for a multi-partner startup is the allocation of roles.

Intellectual Property 252

Intellectual Property Equity Cofounder CTO Hire 252

SoCal CTO

MAY 10, 2011

A long-time friend and colleague, Steve Wexler, who is great at visualization took my Startup CTO Salary and Equity Data and produced a really need interactive visualization via Tableau. Of course, as you would suspect, equity percentages dilute based on years in business. The larger the circle, the larger the number of responses.

Salary 198

Salary Equity San Francisco Dilution 198

The Next Web

OCTOBER 7, 2013

Every time a startup raises capital, all common shareholders are diluted. In a CTO Salary and Equity trends report by Safire Partners, it finds non-founder equity compensation to settle out below 2 percent. All of the estimates displayed above are figures prior to any dilution. percent to 3 percent range for engineer #1s.

Engineer 129

Engineer Dilution Option Pool Vesting 129

SoCal CTO

MAY 10, 2011

A long-time friend and colleague, Steve Wexler, who is great at visualization took my Startup CTO Salary and Equity Data and produced a really need interactive visualization via Tableau. Of course, as you would suspect, equity percentages dilute based on years in business. The larger the circle, the larger the number of responses.

Salary 175

Salary Equity San Francisco Dilution 175

Startup Professionals Musings

JULY 1, 2022

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 343

Stock Options Advisory Board Stock Startup 343

Startup Professionals Musings

NOVEMBER 8, 2010

Who will be the CEO, CFO, and CTO? All partners should never forget that their allocated shares are only the beginning, and will be diluted proportionately when outside funding is later required from angels or venture capitalists. The next big challenge for a multi-partner startup is the allocation of roles.

Equity 228

Equity Intellectual Property Cofounder CTO Hire 228

Both Sides of the Table

SEPTEMBER 17, 2011

I usually encourage people to think about titles like, “Founder & CTO&# or “Founder & VP Marketing.&#. Dilute your cash, equity or both. Create hassles for post-merger integration of technology or teams. Functional roles provide more clarity around roles and responsibilities. and my favorite].

Operations 292

Operations CTO Hire Startup Early Stage 292

The Next Web

NOVEMBER 20, 2013

So, a fair split, would be closer to 60/40 in favor of the funding founder, when diluted for the cash. The calculation comes as follows: original 50/50 diluted down 20 percent to 40/40 for the financing, and then the one funding founder gets that 20 percent. How important is this person’s role?

Cofounder 136

Cofounder Equity Founder Seed Stage 136

Both Sides of the Table

JULY 22, 2010

The more senior members you have (say you already have a CEO, CTO, VP marketing, VP Biz Dev, VP Products) then the less options you’ll need and vice versa. The VC’s $1 million still buys them 25% of your company – it’s you who has diluted to 60% ownership rather than 75%. That’s normal.

Valuation 405

Valuation Liquidation Preference Pre-Money Valuation Term Sheet 405

The Next Web

OCTOBER 10, 2013

Too dilutive.”. After launching our Windows online backup service five years ago, our CTO pitched that we should focus on launching our Mac version next. Dilution – bringing on a co-founder likely means you’re splitting your share in half. You know what is definitely the wrong number of cofounders? Too many.”.

Cofounder 143

Cofounder Technical Cofounder Kenya Dilution 143

Startup Professionals Musings

SEPTEMBER 25, 2019

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Equity 237

Equity Stock Options Advisory Board Stock 237

Business Plan Blog

OCTOBER 4, 2013

Having too many co-founders will only lead to your eventual dilution. This leaves the CTO / Senior Architect to focus on product development and managing the recently hired engineers. Be sure to leave plenty of equity for investors. You will likely need to raise more rounds of capital than you originally anticipated.

Part-Time VPE 79

Part-Time VPE Fractional VPE Cofounder CTO Hire 79

thinkspace.com

SEPTEMBER 7, 2012

Should founders have anti-dilution rights? I am being offered a single digit percentage of outstanding shares, which I believe is based on the founder’s application of a share distribution as though I am in a CTO or a Director Of Engineering role. You would want to check and see if your shares can be diluted. Five years?

Equity 62

Equity Employee Founder CTO Hire 62

www.avc.com

SEPTEMBER 22, 2011

The other important data point is the number of fully diluted shares. The first bracket is the senior management team; the CFO, Chief Revenue Officer/VP Sales, Chief Marketing Officer/VP Marketing, Chief Product Officer/VP Product, CTO, VP Eng, Chief People Officer/VP HR, General Counsel, and anyone else on the senior team.

Equity 64

Equity Employee CTO Hire Fractional CTO 64

www.inc.com

SEPTEMBER 24, 2011

We had a rough time early on," says Parker, president and chief technology officer of Roving Software Inc. , Besides the future potential earnings youre forgoing, youre also diluting your own ownership in the company. a 50-employee provider of e-marketing solutions to small and midsize businesses, based in Needham, Mass.

Fractional CTO 40

Fractional CTO Equity Iowa Technical Cofounder 40

ithacaVC

SEPTEMBER 4, 2011

Here is the latest edition of Finance Fridays from Brad Feld called “Introducing the Cap Table and CTO” Every startup needs someone to be in charge of the Cap Table. Note how the new CTO Praveena implicitly negotiated to get her 15% founders shares after creation of the stock option pool.

Cap Table 49

Cap Table Finance Option Pool Warrant 49

Startup Professionals Musings

OCTOBER 21, 2017

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock 140

Stock Stock Options Advisory Board Startup 140

The Next Web

OCTOBER 3, 2012

Andrew is the co-founder and CTO of Parse.ly , a technology startup that provides big data insights to the web’s best publishers. So, growing more not only has the effect of adding more weight to the company, but also of diluting each employee’s decision-making stake (feeling of overall responsibility) in the company.

Cofounder 155

Cofounder Technical Cofounder Technical Review Software Review 155

The Next Web

JANUARY 24, 2014

Think of Werner Vogels (CTO of Amazon), Guido van Rossem (founder of Python programming language and senior engineer at Dropbox) or the more senior Gerard Kleisterlee (chairman of Vodafone). I believe it is our excessive urge to ‘act normal’ and disdain of ‘networking’ that dilutes our social glue. How to fix this?

Netherlands 143

Netherlands Technical Review Stock Silicon Valley 143

Startup Professionals Musings

OCTOBER 17, 2013

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 224

Stock Options Stock Advisory Board Startup 224

Startup Professionals Musings

SEPTEMBER 22, 2012

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 230

Stock Options Stock Advisory Board Startup 230

Startup Professionals Musings

JULY 24, 2011

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Equity 234

Equity Advisory Board Stock Options Stock 234

Startup Professionals Musings

MARCH 29, 2015

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock Options 120

Stock Options Stock Advisory Board Startup 120

Startup Professionals Musings

JUNE 20, 2010

CEO brought in to replace the founder, 5 - 10% CTO, CFO, VP of Marketing or Sales, 1.5 - 3% Chief Engineer or Architect, 1 - 1.5% You should also assume that your percentage will go down through dilution as the company raises additional rounds, and offer sizes will go down as the company grows. 7% Product Manager,2 -.3%

Stock 144

Stock Stock Options Advisory Board Startup 144

The Next Web

DECEMBER 3, 2013

If that’s the Chief Technology Officer, or the sales chief, or the marketing person, whoever is the best public speaker, you should always put your best foot forward.”. Instead, you should look at everyone in your team and pick the person who is best at explaining and selling your idea. Try, try, try again.

Startup 153

Startup Cofounder Valuation Dilution 153

David Teten

OCTOBER 1, 2015

At the same time, a direct equity investment (one where the dev shop acquires a share in the company immediately) puts the founders in a potentially uneasy position of having to dilute their company before a product is built. During and after fundraising, we team with the founder to recruit for a full-time CTO to join the company.

Software Developers 60

Software Developers Software Development Software Review Technical Cofounder 60

Startup Company Lawyer

MAY 4, 2009

Joe Betts-LaCroix – CTO, OQO. of the founder’s company’s fully-diluted capitalization immediately after an initial equity financing raising greater than $100,000. The Founder Institute has assembled 25 executives to serve as mentors for the participants and to lead weekly sessions. Jason Calacanis - CEO, Mahalo.

Founder 28

Founder Warrant San Francisco Intellectual Property 28

www.quora.com

SEPTEMBER 22, 2011

Update Link to Questions, Topics and People Add Find Questions, Topics or People Comment Jason Crawford , Co-founder & CTO at Kima Labs 25 votes by Abinash Tripathy , Anon User, Dean Blackburn , (more) Chris Dixon says it all in a post titled "There Are Two Kinds of Pe. more) Sign up for free to read the full text. link] 8/12/15.

Equity 40

Equity Employee Founder Cofounder 40

This is going to be BIG.

MAY 21, 2010

Having a technically complex product without a CTO. Why else would you take the increased dilution? But sometimes, the finance guy in me sees opportunities that seem to present way more risk—potentially unnecessary risk—than it would seem the investment has relative to some near term point where that could go away.

Hockey Stick 97

Hockey Stick Valuation Venture Capital Dilution 97