I got offered to work for 6 months for equity only for startup currently valued at 500k, looking to close investment round where they expect 2M for 10%. After that I can work for base salary as well. Is that something you would consider? What would be the normal offer look like in this case? This startup has 5 people right now, I would be most senior dev. Yoe:8 Tc:95k (europe)
How much equity are they offering?
Its so unclear right now but I tought I would get some info on if it makes sense at all before asking details. But its in order of 1%.
That’s not enough for no salary
You will be working for someone else's dream. If the dream goes kaput, the dreamer won't lose as much as you would. Also, dreams don't pay your bills. In short, don't if you don't have a vested interest in the product.
I have enought money saved that I can rest next 10 years so I dont mind not having salary that much. But I dont know what should equity be as its a formula of risk and reward.
It looks like 5 donkeys are looking for a guy to do the work for them tbh
Lol no
1% is too little. At 2% you might start to consider it if you really think this will be a success. You should do some math to value the equity at different valuations/multipliers to see where this starts to make sense when divided by different chances of success
No pay? You need founder equity. 5-10%
1% fully vested in 6 months is equivalent to 8% over 4 years (which I think is fair)
And equals 100% over 50 years. Easy decision!
Lol Microsoft....true that though. This may just be one time jet... So even if the company becomes 100m in a few years...AND nkt too much dilution happens..op may have a chance fo maybe make 500-600k max ... The way things are right now...op can anyways make that much money far more easily
would def consider. the equity would need to be 5% or more.
6 months for only equity?? Are you crazy???
I would need a huge percentage to even consider it. 20-50% depending on the specifics
What kind of idiot would bring on a contractor, however skilled, for 6 months for 50%? Your numbers are bonkers.
if they need good engineer on a 500k valuation company. they can always hire some low quality engineer.
Absolutely not
Do it only if you are a cofounder. Otherwise it does not make sense
What qualifies one as a co-founder? Getting a specific equity percentage? Something else?
The equity: let's say 2 founders split the company for 50/50, when they raise money they will only squeeze like 20-25% to make room for the first investor. With one investor at 20%, they each own 40% of the company. As a non-founder you'll get like 1-3% tops.