Startup Professionals Musings

AUGUST 24, 2016

You need to find the skills or experience you don’t have in business, technology, or money. So the first question I usually get is what percent of the company or equity is that person worth? Just because it was your idea doesn’t mean you “deserve” 90% of the equity. The CTO of many technical startups was the original founder.

Equity 120

Equity Cofounder Technical Cofounder Intellectual Property 120

Feld Thoughts

SEPTEMBER 2, 2011

This week they set out to create their cap table and hire a CTO. The founders each have common shares that will vest over four years. The vesting schedule protects each of the co-founders in case one gets hit by a bus or decides to drop the project after a short period of time. Time to update the cap table.

Cap Table 133

Cap Table CTO Hire Technical Cofounder Cofounder 133

Startup Professionals Musings

AUGUST 4, 2014

You need to find the skills or experience you don’t have in business, technology or money. The first question I usually get is what percent of the company or equity is that person worth? Just because it was your idea doesn’t mean you “deserve” 90 percent of the equity. The CTO of many technical startups was the original founder.

Cofounder 261

Cofounder Stock Founder Technical Cofounder 261

The Next Web

NOVEMBER 20, 2013

There are a lot of variables to go into calculating a fair equity split a startup team. So, a CEO or CTO, would get a much higher stake than an office manager or a graphic designer, as an example. You need to collectively take all four paragraphs into consideration, in calculating a fair equity split between the founders.

Cofounder 136

Cofounder Equity Founder Seed Stage 136

Startup Professionals Musings

SEPTEMBER 25, 2019

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Equity 237

Equity Stock Options Advisory Board Stock 237

Startup Professionals Musings

JULY 1, 2022

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Stock Options 343

Stock Options Advisory Board Stock Startup 343

www.avc.com

SEPTEMBER 22, 2011

Employee Equity: How Much? The most common comment in this long and complicated MBA Mondays series on Employee Equity is the question of how much equity should you grant when you make a hire. And the amount of equity you need to grant to accomplish these hires is also an art and most certainly not a science.

Equity 64

Equity Employee CTO Hire Fractional CTO 64

www.inc.com

SEPTEMBER 24, 2011

Should You Share Equity with Consultants? Science and Technology Technology. We had a rough time early on," says Parker, president and chief technology officer of Roving Software Inc. , Parker found that equity as compensation helped build loyalty to his company -- even among consultants.

Fractional CTO 40

Fractional CTO Equity Iowa Technical Cofounder 40

blog.aparttimecto.com

OCTOBER 23, 2010

A Part-Time CTO Technology. Flexibility - You won’t need to commit to something, either cash, equity or involving other people, upfront. Cons: Money - Unless you have cash to pay, the pool of developers willing to work for equity is small. In Plain English. Archive Jun 20th Sun In-House or Outsource?

CTO Hire 40

CTO Hire Fractional CTO Equity Vesting 40

www.startuplessonslearned.com

MAY 4, 2012

Founders Dilemmas: Equity Splits. The following is an exclusive excerpt which sets up a common pitfall regarding equity splits. In Noam’s dataset, 73% of founding teams split equity within a month of founding, a striking number given the big uncertainties early in the life of any startup. Lessons Learned. by Eric Ries.

Equity 72

Equity Founder Technical Cofounder Cofounder 72

Startup Professionals Musings

JULY 24, 2011

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Equity 234

Equity Advisory Board Stock Options Stock 234

Scalable Startup

OCTOBER 9, 2014

Talking to CEO and CTO about role as co-founder/COO. How much equity should I ask for? > You need to be positioned as an equal partner, regardless of equity or title. > > What are the terms of the equity, same class of shares as them? . > Vesting? > Your equity depends on all of these? >

Cofounder 20

Cofounder Technical Cofounder Equity Vesting 20

Startup Professionals Musings

OCTOBER 21, 2017

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Stock 140

Stock Stock Options Advisory Board Startup 140

Startup Professionals Musings

OCTOBER 17, 2013

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Stock Options 224

Stock Options Stock Advisory Board Startup 224

Startup Professionals Musings

SEPTEMBER 22, 2012

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Stock Options 230

Stock Options Stock Advisory Board Startup 230

Startup Professionals Musings

MARCH 29, 2015

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Stock Options 120

Stock Options Stock Advisory Board Startup 120

Startup Professionals Musings

JUNE 20, 2010

By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.” 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% Advisory Board Member, 1% Senior Engineer,3 -.7% 7% Product Manager,2 -.3%

Stock 144

Stock Stock Options Advisory Board Startup 144

The Next Web

OCTOBER 7, 2013

Quite frankly, waiting provides more assurance around employment risk without the commensurate sacrifice in equity comp. It is typical for employees to vest their options over four years with a one year cliff, which means a new hire must stay on the company for at least one year to see any shares. How do you feel about that number?

Engineer 129

Engineer Dilution Option Pool Vesting 129

thinkspace.com

SEPTEMBER 7, 2012

Office Space. Virtual Office. How to Divide Equity to Startup Founders, Advisors, and Employees. The part that I’d like to zero in on is when you’ve got a high growth company what are some of the best practices out there to distribute equity to the founders, advisors, and employees? Equity for Founders.

Equity 62

Equity Employee Founder CTO Hire 62

David Teten

OCTOBER 1, 2015

Not surprisingly, the list above also is ranked from least to most equity stake in an investment for the investor, relative to the cash they invest. How would one set up such a startup to eventually raise capital from outside VCs, who will be wary of ‘dead equity’ (i.e., equity that belongs to departed cofounders)? The cliffs?

Software Developers 60

Software Developers Software Development Software Review Technical Cofounder 60

www.quora.com

SEPTEMBER 22, 2011

Type to Add and Search Questions; Search Topics and People Startups Startup Compensation Entrepreneurship Compensation Stock Options Major Internet Companies Silicon Valley Why is there such a large founder to early employee equity drop-off? This ties into this Paul Graham article: [link] /equity. Login if you already have an account.

Equity 40

Equity Employee Founder Cofounder 40

Both Sides of the Table

MAY 5, 2011

There’s you and your killer CTO co-founder. It’s clear that America has a vested interest in promoting entrepreneurship in many regions in the country to stimulate innovation & job creation. Your highest priority right now is hiring the 1 or 2 people that are going to join your company and make a difference.

Seattle 317

Seattle Silicon Valley Technical Review Los Angeles 317

www.metamorphblog.com

OCTOBER 23, 2010

Here’s how the pitch sounds from the engineer’s perspective: ‘For ten whole percent of equity, you will slave away to build a prototype out of my shitty idea, not have any say in the decision-making process…and oh yeah, you could be fired at any point.’ Date for a bit, then split the equity. Learned a lot.

Founder 51

Founder Startup Cofounder Vesting 51

Startup Professionals Musings

NOVEMBER 8, 2010

One of the first tough decisions that startup founders have to make is how to allocate or split the equity among co-founders. Another common “failure to start” situation I see is one where the “idea person” insists that the idea is 90% of the value (and 90% of the equity). Who will be the CEO, CFO, and CTO?

Equity 228

Equity Intellectual Property Cofounder CTO Hire 228

www.chubbybrain.com

SEPTEMBER 28, 2011

Don’t exacerbate the issue by needing to figure out how to deal with large equity deadweight on your hands (investors won’t like that the #2 stakeholder is absent, even estranged, from your company). So, the best way of dealing with this issue is to take a long, long vesting period for all major sweat equity founders.”.

Cofounder 89

Cofounder Startup Technical Cofounder CTO Hire 89

Startup Professionals Musings

APRIL 23, 2012

One of the first tough decisions that startup founders have to make is how to allocate or split the equity among co-founders. Another common “failure to start” situation I see is one where the “idea person” insists that the idea is 90% of the value (and 90% of the equity). Who will be the CEO, CFO, and CTO?

Intellectual Property 252

Intellectual Property Equity Cofounder CTO Hire 252