How much equity is normal?

At a typical venture-backed startup, the employee equity pool tends to fall somewhere between 10-20\% of the total shares outstanding. That means you and all your current and future colleagues will receive equity out of this pool.

How much equity should an early employee get?

Employee option pools can range from 5\% to 30\% of a startup’s equity, according to Carta data. Steinberg recommends establishing a pool of about 10\% for early key hires and 10\% for future employees. But relying on rules of thumb alone can be dangerous, as every company has different cash and talent requirements.

What percentage equity should I ask for?

The longer after you join does the fundraising occur, the higher you should negotiate in terms of equity compensation. Overall, you should expect anywhere from 5\% to 15\% of the company.

How much equity do founders retain?

As a rule, independent startup advisors get up to 5\% of shares (or no equity at all). Investors claim 20-30\% of startup shares, while founders should have over 60\% in total. You may also leave some available pool (5\%), but don’t forget to allocate 10\% to employees.

Which pay generates equity in pay?

Bonus generates equity in pay.

What are the benefits of equity compensation for startups?

Often this leads to startups hiring junior employees, which then leads to poor performance. Equity compensation allows you to hire senior employees for the cost of junior ones. E.g. at Senstone we hired a $5000/month engineer for $1500/month salary (in Ukraine) Gives a sense of ownership to your team.

How much equity should you offer in a job offer?

One last bit is ranging. It’s a good practice to offer a candidate a variable range of equity vs cash. E.g. in the case above it can be $1500 cash and 4.2\% equity or $2000 cash and 3.6\% equity or $0 cash and 6\% equity or anything in between. This gives some control back to the candidates and also gives you an idea of what motivates them.

What is equequity compensation?

Equity compensation allows you to hire senior employees for the cost of junior ones. E.g. at Senstone we hired a $5000/month engineer for $1500/month salary (in Ukraine) Gives a sense of ownership to your team.

How much equity do engineers at rewardspay give to each other?

When Shukla was building her team at RewardsPay, she gave the earliest engineers joining her team an equity share of between .5\% and 1\%, depending on both experience and a person’s salary requirements.