The Next Web

JUNE 15, 2012

From Silicon Valley to Peoria, Illinois, cash-strapped startups look for inventive way to finance their business – often handing out equity to employees, consultants, vendors, and other service providers. Pitfalls in sharing equity. While equity can be a great tool for compensating early on, the drawbacks are significant.

Equity 116

Equity Stock Options Vesting Stock 116

The Next Web

NOVEMBER 20, 2013

George Deeb is the Managing Partner at Chicago-based Red Rocket Ventures , a startup consulting and financial advisory firm based in Chicago. There are a lot of variables to go into calculating a fair equity split a startup team. In this case, I would take your total ownership and divide it up by employee tiers.

Cofounder 136

Cofounder Equity Founder Seed Stage 136

VC Adventure

AUGUST 16, 2020

Despite how much time companies talk about the importance of their employees and, in many cases, how every employee is also an “owner” of their business through their option program, most companies are pretty ad hoc (or down right sloppy) about how they plan for and execute their option program.

Programming 149

Programming Vesting Equity Software Review 149

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

Startup Professionals Musings

JULY 1, 2022

Wouldn’t you like to be one of the lucky people who joined Google and Facebook when these were startups, and now be a multi-millionaire or better? So people ask me “How many shares should I ask for or expect when I join a startup today?” Thus, options don’t “pay the mortgage” today, so to speak. 7% Product Manager,2 -.3%

Stock Options 343

Stock Options Advisory Board Stock Startup 343

The Next Web

OCTOBER 7, 2013

That’s what a couple of my friends – engineers at Google and Bloomberg who have been following the rise of startup culture with intrigue – told me recently. Quite frankly, waiting provides more assurance around employment risk without the commensurate sacrifice in equity comp. “It kinda sucks to be engineer #1.”.

Engineer 129

Engineer Dilution Option Pool Vesting 129

NZ Entrepreneur

SEPTEMBER 29, 2021

It is our startup sector which will drive this innovative progress. Startup founders are our ambitious problem solvers. To generate growth in a startup, it is almost always necessary to raise external capital to run the necessary. In order to understand startup governance, you need to understand risk and reward.

Technical Review 88

Technical Review Software Review New Zealand Due Diligence 88

Startup Professionals Musings

APRIL 10, 2016

Every startup founder loves to prompt for questions from investors and potential key team members about their vision, and the huge opportunity that can be had with their disruptive technology. Early stage burn rates over $50K per month, or a runway of less than six months may indicate an inefficient or desperate startup.

Sweat Equity 120

Sweat Equity Burn Rate Technical Review Intellectual Property 120

Startup Professionals Musings

MAY 8, 2022

Most entrepreneurs struggle with many startup founders quandaries in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. You have very little money, and you don’t want to give away your equity. The right motivated employees dilemma.

Founder 325

Founder Hockey Stick Cofounder Liquidity Event 325

Startup Professionals Musings

APRIL 8, 2015

Every startup founder loves to prompt for questions from investors and potential key team members about their vision, and the huge opportunity that can be had with their disruptive technology. Early stage burn rates over $50K per month, or a runway of less than six months may indicate an inefficient or desperate startup.

Technical Review 120

Technical Review Due Diligence Sweat Equity Burn Rate 120

Startup Professionals Musings

SEPTEMBER 25, 2019

Wouldn’t you like to be one of the lucky people who joined Google and Facebook when these were startups, and now be a multi-millionaire or better? So people ask me “How many shares should I ask for or expect when I join a startup today?” Thus, options don’t “pay the mortgage” today, so to speak. 7% Product Manager,2 -.3%

Equity 237

Equity Stock Options Advisory Board Stock 237

www.instigatorblog.com

OCTOBER 23, 2010

Home About Contact My thoughts & lessons learned on startups, entrepreneurship, marketing and other stuff. Changing Equity Structures for Early Startup Employees Tweet Recently someone asked me for advice on how much equity they should give to their early employees. Those first employees will take 0.5-1%

Equity 41

Equity Employee Startup Vesting 41

Altgate

JUNE 25, 2012

—————– Dead equity — equity held by employees and founders no longer working at the company — is a large and growing problem. Choe opted to forgo a cash payment “in the thousands” for the equity equivalent at the time. Re-posted from post co-authored with Prof. million.

Equity 44

Equity Vesting Cap Table Technical Review 44

David Teten

JULY 10, 2019

pre-launch, BIG equity, big peeps involved–ANY TIPS?? Do you have a great team at your seed startup, but your product just isn’t working? Would you like to have a salary from day one that you work full-time on your startup? We are a nonpartisan, bipartisan startup of concerned Americans.

America 60

America Technical Review Advisory Board Due Diligence 60

ReadWriteStart

MAY 3, 2012

The conflicting (frequently unsolicited) advice startup entrepreneurs too often hear is enough to make you tune it all out. But bootstrapping a startup is not easy, requiring discipline and fortitude, as well as ingenuity. But bootstrapping a startup is not easy, requiring discipline and fortitude, as well as ingenuity.

Bootstrapping 137

Bootstrapping Software Review Startup Equity 137

Gust

APRIL 9, 2014

Equity dilution works when the same pie is divided among more people. Over time, other people receive pieces of equity in exchange for work (employee stock options), money (seed, angel and venture investors), services (attorneys, directors, etc.).

Dilution 150

Dilution Equity Vesting Stock Options 150

YoungUpstarts

OCTOBER 19, 2018

When you’re looking for extra funds, there are typically two options: debt financing and equity financing. It’s important to understand the difference between debt financing and equity financing so when it comes time to get additional funding, you know which is the right fit for your business and how to get it. Equity Financing.

Finance 157

Finance Equity Vesting Dividend 157

View from Seed

DECEMBER 4, 2014

Editor’s note: Understanding how to divide founder equity at a startup can be tricky, even to the point of reaching emotional riffs between founders. Below, Lee Hower offers advice for approaching these equity discussions objectively and properly. Sometimes co-founders put off the equity split question for some time.

Equity 315

Equity Founder Sweat Equity Cofounder 315

David Teten

MAY 7, 2019

Do you have a great team at your seed startup, but your product just isn’t working? Would you like to have a salary from day one that you work full-time on your startup? We are a nonpartisan, bipartisan startup of concerned Americans. We agree on an equity split, vesting, and initial compensation structure.

America 60

America Technical Review Advisory Board Due Diligence 60

Altgate

AUGUST 25, 2012

—————– Dead equity — equity held by employees and founders no longer working at the company — is a large and growing problem. Choe opted to forgo a cash payment “in the thousands” for the equity equivalent at the time. Re-posted from post co-authored with Prof. million.

Equity 28

Equity Vesting Cap Table Technical Review 28

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? Many startups these days are first-time entrepreneurs. This answer.

Equity 40

Equity Employee Founder Cofounder 40

Agile VC

DECEMBER 4, 2014

As a result, one of the trickier things co-founders tackle is determining the equity split amongst the founding group of individuals. Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits.

Cofounder 255

Cofounder Equity Founder Sweat Equity 255

ConversionXL

NOVEMBER 6, 2019

We also got lucky and qualified for some startup benefits with companies like Rackspace, who covered our infrastructure costs for the first year,” continues Arsenault. “We Vested Technology spent $17k on their MVP. Prior to his role at Vested Technology, co-founder and CEO Akash Srivastava worked on Wall Street.

Sweat Equity 78

Sweat Equity Software Review Vesting Cofounder 78

www.mattbartus.com

SEPTEMBER 24, 2011

Perspectives on issues affecting founders, startups and investors from a veteran startup lawyer in Silicon Valley. Equity for Consultants – Keep it Simple! posted Feb 3 in Equity , People issues. The most you lose is 1 or 2 months of vesting on the stock. A View from the Valley. Blog blog archive. About Matt.

Equity 40

Equity Vesting Silicon Valley Intellectual Property 40

www.inc.com

SEPTEMBER 24, 2011

Advisor. ); STARTUP. Employee Benefits. Should You Share Equity with Consultants? Back in 1997, Randy Parker was staring at a blank whiteboard, wondering where hed find the money to hire the employees and consultants he needed to build his new product. "We But sharing equity can have pitfalls, too. Newsletters.

Fractional CTO 40

Fractional CTO Equity Iowa Technical Cofounder 40

Scott Edward Walker

SEPTEMBER 28, 2011

Vesting Restrictions. The first deadly mistake relates to vesting restrictions. And if the departing founder has a huge chunk of equity, it is unlikely that the company will find many sophisticated angels or VC’s interested in investing. IP Ownership. You should carefully review all employment-related agreements (e.g.,

Vesting 89

Vesting Software Review IP Intellectual Property 89

Steve Blank

MAY 19, 2015

Startups focus on speed since they are burning cash every day as they search for product/market fit. While technical debt is an understood problem, it turns out startups also accrue another kind of debt – one that can kill the company even quicker – organizational debt.

Technical Review 120

Technical Review Salary Early Stage Software Review 120

Startup Professionals Musings

AUGUST 10, 2019

Most entrepreneurs struggle with many startup founders quandaries in building their business, and these key dilemmas are probably the biggest source of pain and failure for the entrepreneur lifestyle. You have very little money, and you don’t want to give away your equity. The right motivated employees dilemma.

Hockey Stick 243

Hockey Stick Cofounder Liquidity Event Startup 243

Startup Professionals Musings

JULY 24, 2011

Wouldn’t you like to be one of the lucky people who joined Google and Microsoft when these were startups, and now be a multi-millionaire? So people ask me “How many shares should I ask for when I join a startup today?” By the way, you will normally only be offered “options,” which vest over a 4-year period after a 1-year “cliff.”

Equity 234

Equity Advisory Board Stock Options Stock 234

discuss.joelonsoftware.com

NOVEMBER 1, 2010

where I can learn about how to build a sweat equity team? Right now, my business is just myself and a part-time employee who does support, testing, and product usability design. Rather, it is a proposal for sweat-equity investors. Equity partners need to have a hand in guiding the enterprise. The gist: 1.

Sweat Equity 40

Sweat Equity Equity Angel Investor Affiliate 40

David Teten

OCTOBER 1, 2015

intrapreneurs, e.g., the employee of GE who is tasked with launching a new business. 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. equity that belongs to departed cofounders)? mentor VCs, e.g., most VCs. What are the timelines?

Software Developers 60

Software Developers Software Development Software Review Technical Cofounder 60

K9 Ventures

OCTOBER 27, 2016

One of these norms is how founder vesting and employee vesting works. I won’t get into employee vesting today as that has much more to consider than I have time to cover in this short post today. Here is a good summary post from Cooley GO on Founder Vesting. The first is fairly obvious.

Founder Vesting 48

Founder Vesting Vesting Founder Term Sheet 48

David Teten

DECEMBER 3, 2019

Private equity and venture capital investors are copying our sisters in the hedge fund world: we’re trying to automate more of our job. . In the private equity universe, most Partners have primary training as deal-makers, not as managers. Point Nine Capital uses 15Five for continuous employee feedback. 2) Market .

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

Agile VC

DECEMBER 4, 2014

As a result, one of the trickier things co-founders tackle is determining the equity split amongst the founding group of individuals. Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits.

Cofounder 173

Cofounder Equity Founder Sweat Equity 173

Scott Edward Walker

OCTOBER 19, 2020

Over the past six months, my firm has been engaged by a number of startups with significant intellectual property (“IP”) problems. The purpose of this blog post is to briefly discuss the three most common IP mistakes that startups make. working on the startup) while employed. Introduction. Any IP created by a founder (e.g.,

IP 52

IP Software Review Founder Technical Review 52

ConversionXL

NOVEMBER 6, 2019

We also got lucky and qualified for some startup benefits with companies like Rackspace, who covered our infrastructure costs for the first year,” continues Arsenault. “We Vested Technology spent $17k on their MVP. Prior to his role at Vested Technology, co-founder and CEO Akash Srivastava worked on Wall Street.

Sweat Equity 50

Sweat Equity Software Review Vesting Cofounder 50

Gust

DECEMBER 1, 2011

What is a startup really? Notice what is missing from this list of priorities: The company itself – that is, a business entity, most often a corporation , that will own the entire business (however defined), issue equity to founders, take investment capital , enter into contracts, make sales, pay employees and contractors, and so forth.

IP 114

IP Intellectual Property Equity Liquidity Event 114