Do you reward these people with more than a fraction of a percent of equity? As someone who likes WLB enough, isn't enough of a gambler to take a 0.001% chance of being a millionaire over a 25-50% chance of getting a nice 6 figure payout from a more established startup, and has too many kids to boot, I never bothered looking at a company that didn't have a health insurance plan and a 401k match. But when I learned it was common for a founding engineer to get like half a percent of the company, I was appalled. I'd rather just start my own startup and roll the dice there if I'm still going to have to build the whole damn thing just for a fraction of a percent in equity.
It seems super weird that you'd literally be in the trenches with 1-2 other people who each have as much equity as 50-100 of you.
Otherwise, I mean, why should someone brilliant work for you instead of a company with much better odds of success?
Clearly, companies do hire founding engineers at these rates so maybe I'm the crazy one. But it just seems wild to me.
when I learned it was common for a founding engineer to get like half a percent of the company, I was appalled. I'd rather just start my own startup
I don't think people appreciate how hard it is to go from 0-1. To validate a product/market, get initial customers, before raising, heavily derisks the business and 1% is fair. Sure, you could just start your own startup, but you'll have to go through the brutal glass eating process of doing exactly that, starting a company.
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Do you reward these people with more than a fraction of a percent of equity? As someone who likes WLB enough, isn't enough of a gambler to take a 0.001% chance of being a millionaire over a 25-50% chance of getting a nice 6 figure payout from a more established startup, and has too many kids to boot, I never bothered looking at a company that didn't have a health insurance plan and a 401k match. But when I learned it was common for a founding engineer to get like half a percent of the company, I was appalled. I'd rather just start my own startup and roll the dice there if I'm still going to have to build the whole damn thing just for a fraction of a percent in equity.
It seems super weird that you'd literally be in the trenches with 1-2 other people who each have as much equity as 50-100 of you.
Otherwise, I mean, why should someone brilliant work for you instead of a company with much better odds of success?
Clearly, companies do hire founding engineers at these rates so maybe I'm the crazy one. But it just seems wild to me.
I don't think people appreciate how hard it is to go from 0-1. To validate a product/market, get initial customers, before raising, heavily derisks the business and 1% is fair. Sure, you could just start your own startup, but you'll have to go through the brutal glass eating process of doing exactly that, starting a company.
I would focus first on profit or rev share or commission.
Alignment on profitability and efficiency leads to wanting to be together more permanently anyways.
If they can stick around there may be room for a larger conversation for actual retention.
Handing out equity for a self-funded startup doesn't mean as much especially if the hires don't execute.