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The Option Pool Shuffle

Use a hiring plan to justify a small option pool, increase your share price, and increase your effective valuation. Thanks!

Option Pools and VC Negotiations

Rob Go

In my last post about raising seed vs. jumping straight to A, I received a good comment from Chris Woods that my analysis neglected to include the impact of option pools that are created at each financing round. Essentially, the new investor wants there to be a certain % of options available to employees after they invest.

When The VC Asks: About Your Hiring Plan

Hunter Walker

Whether it’s adding capacity to an existing function (#MawrEngineers) or bringing new talents onboard (“we intend to make our first marketing hire”), glossing over these bullet points towards the back of the pitch deck would be a mistake. I’m interested in not just what these people will be doing but how and when they’ll be hired.

What is it Like to Negotiate a VC Round?

Both Sides of the Table

How much is in the option pool? Well, if you have an option pool of only 6% and have many more execs to hire to build out your team you’re going to ask for more options to be created in the future. Option pool (likely dilution in the future, which is a function of a higher price just not yet defined).

Equity for Early Employees in Early Stage Startups


For your first key hires, three, five, maybe as much as ten, you will probably not be able to use any kind of formula. n = (1.2 - 1)/1.2 =.167.

In VC deals, Price Doesn't Matter - But The "Promote" Does

Seeing Both Sides

The investors who provided the $4 million own 40% of the company and the management team owns 60%. Another term that impacts the price is the size of the option pool. Most VCs invest in companies that need to hire additional management team members and sales and marketing and technical talent to build the business.

Everything you ever wanted to know about advisors, Part 1

This is the advisor paradox : hire advisors for good advice but don’t follow it, apply it. Your task is to hire the maverick advisors in the crowd. Hiring advisors is an ongoing effort. Then hire him if you like the results. The Option Pool Shuffle. Venture Hacks Good advice for startups. SPONSORED BY.

Startup Administrivia: Part 1 – getting started

Startup Musings

And you are managing your time so you are able to focus on these value generating activities. Hiring professional service providers. Hiring professional service providers. The easiest thing to do is to hire a corporate attorney to do it for you. Hire a contract accountant who can set you up with Quickbooks.

How to Fund a Startup

And if trouble withinvestors is one of the biggest threats to a startup, managing themis one of the most important skills founders need to learn. Ifyour competitors offer employees stock options that might make themrich, while you make it clear you plan to stay private, yourcompetitors will get the best people. Want to start a startup?

A Compilation of the Web's Best Advice for Entrepreneurs

Platforms and Networks

Follow links in this post for current thinking on best practices in startup management. My selections are tailored for consumer Internet startups, but should be helpful to teams in other sectors. There’s a lot of information here, so don’t try to digest everything in one session. Great list. Tom, well done - solid list.

The Things I Wish I Could’ve Told Young Mr Fishkin | Rand Fishkin, Moz | BoS EU 2016

Business of Software Blog

But early on, I made plenty of mistakes in hiring including in leadership and junior roles, all across the board. 6: Hire Less. Video.

Startup Equity For Employees

5 Stock vs Options. The re-heating of the venture funded tech market has pushed a heat up of the hiring market, and Im getting more calls from friends asking for help understanding startup stock (equity) offers. Also, most companies try to keep all employees on the same terms, and there are good management reasons to do that.

How does funding work? Angel & VC investment in Nordic startups by the numbers


However, after some very intensive work and a quick two month process with one of the bigger VCs in the Nordics, she manages to raise € 2.5

Founders versus early employees

Being an early hire at a startup gives an individual the ability to make tremendous impact on an organization as it grows – and both the founders and those hires should know it.” This should force companies to think about building value with each early hire, and not just filling a position. Manager or Junior Engineer 0.2 – 0.33

Growth & Arrogance vs. The Power of a Customer Centric Culture | Art Papas, Bullhorn | BoS USA 2015

Business of Software Blog

And I liked medicine and I love the idea of being a doctor, but I also took a course called the calculus 13, which was like optional calculus. And if anybody remembers that time, all you had to do was use the words world-wide web on a PowerPoint, and this is the PowerPoint presentation that I used to raise $4 million from GE asset management.

The Future of Startup Funding

7 ] And though theres going to be one investor who gives them the firstcheck, and his or her help in recruiting other investors willcertainly be welcome, this initial investor will no longer be thelead in the old sense of managing the round. 13 ]Im not saying option pools themselves will go away. Want to start a startup?

Beware of Premature Merge Elation

Both Sides of the Table

It meant that the management teams hadn’t figured out a product / market fit for their own businesses. They get premature merge elation.


Will Price

I often notice post Series A close a sense of chaos amidst the hope and a need to quickly triangulate on key metrics to manage to and to report against. Data-driven start-up management appears to be an oxymoron - there is by definition little data and hardly any trending possible.

Startups: Cut the Wheat from the Chaff on Quora

VC Cafe

Basecamp – project management. How do bootstrapped companies hire talent? 1 CEO who doubles as head of product management.

CompStudy Highlights: “Live Tweets” from the Webcast

Noam Wasserman

Sources of Hires. TECH] Advice from panel (Aaron): As upturn starts, have to start pulling triggers a little quicker for both sides of hiring (co, hire). [LS] LS] Sources of hires in LS ventures: For all non-CEO/non-CFO positions, CEO-as-source-of-hire has increased in 2009 by at least 14%. Founders. [LS] Salary.

Should You Share Equity with Consultants?

Leadership & Managing | Tuesdays. LEADERSHIP & MANAGING. Managing Creativity. 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 Determine when the consultant will receive the options. "If

9 Quick Tips Learned While Raising $33 Million In Venture Capital


The title is “Money, Marketing and Management with HubSpot’s Founders”. So, I’ve got some direct experience with the process. Factor that in.

Changing Equity Structures for Early Startup Employees

I gave him similar numbers to what I had been given when I was hiring the first few employees for Standout Jobs. 0.5-1% is just not a lot.

Equity is the currency of early stage businesses.


First you must create a stock option plan using your attorney, which must be registered in many states as a security offering. An option plan should carve out an addition of about 15% of the “fully diluted” shares. a share, then options must be priced at that amount. There are some rules. Email readers continue here.]