Equity Calculator

2% of startup or cushy salary at BigCo

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962
Jack Smith@_jacksmith · Serial Entrepreneur & Startup Adviser
I don't think that I'd describe this as 'super simple'. Even as a company founder, I don't keep half the stuff mentioned on here top of mind, so I doubt that any employee is going to have enough information to complete it correctly. e.g. to model what you "would have made" if you'd joined Uber at X stage, you'd have to know the pre-money valuation of each funding round they received, along with the investors' liquidation preferences etc and who knows, they may take on even more funding before going public, which would mean your shares would get diluted even further. Overall, if anything, this just serves to illustrate all the complexities involved in trying to model how much a startup's equity offer is actually "worth" in the long-run and that trying to do calculations to model it against an offer at a big company is totally the wrong way to go about it. It just validates what Mark Suster says here: http://www.bothsidesofthetable.c... don't join a startup because you could potentially make millions of $. Join if you want to learn; any money you make would be if you got really lucky and is a nice side bonus.
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Andrew Chen@andrewchen · Uber
@_jacksmith agree. I find a lot of times startups don't want to disclose all this info either, and asking around to get it comes off too mercenary.
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Kyle Taylor@kftaylor · Product, Upfront Ventures
@_jacksmith +1 was just about to share that post
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Derek Skaletsky@dskaletsky · Head of Product, Kissmetrics
@_jacksmith absolutely. I just tried to do this for our first employee, the biggest factor in the value of his equity is not our past rounds, but future rounds/valuations...that might be a future iteration someone can add (expected funding rounds/valuations). But still...the actual $$ amount shouldn't be something people focus on. If it woks out...Mr/Mrs early employee will do just fine. If it doesn't, you'll still do fine (b/c of the experience/learnings & the knowledge that you gave it a shot and didn't take the easy way out). With that said, I would offer this to early employee candidates. If they get really into it and want a bunch of information in order to fill it out...probably not a good fit. So in that sense, we could call it the "Early Employee Weeder-Outer Test." How's that for a pivot! :)
962
Jack Smith@_jacksmith · Serial Entrepreneur & Startup Adviser
@dskaletsky "If they get really into it and want a bunch of information in order to fill it out...probably not a good fit". EXACTLY. I actually had an employee during one of my last startups ask for loads of numbers (and I actually gave them all to him) and he ran loads of complex calculations. His outcome was "even if you guys get a great outcome and become worth $100m, I'd only get X"; so he turned us down to stay at a large company; ironically the company's now worth quite a bit more than $100m 1 year later. So yes, no point running the figures, but also if things do go well, it's just a bonus.
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Taylor HouHunter@taylorhou1
A super simple equity compensation comparison tool for those that are looking for a more objective reason to take a startup offer.
2664
Cherian Thomas@cherianthomas · VP, Think and Learn (Byjus)
Adding to @_jacksmith comments, here’s something that @garrytan wrote about calculating the “compounding returns of intelligence”. “We tend to massively underestimate the compounding returns of intelligence. As humans, we need to solve big problems. If you graduate Stanford at 22 and Google recruits you, you’ll work a 9-to-5. It’s probably more like an 11-to-3 in terms of hard work. They’ll pay well. It’s relaxing. But what they are actually doing is paying you to accept a much lower intellectual growth rate. When you recognize that intelligence is compounding, the cost of that missing long-term compounding is enormous. They’re not giving you the best opportunity of your life. Then a scary thing can happen: You might realize one day that you’ve lost your competitive edge. You won’t be the best anymore. You won’t be able to fall in love with new stuff. Things are cushy where you are. You get complacent and stall. So, run your prospective engineering hires through that narrative. Then show them the alternative: working at your startup.” http://blog.garrytan.com/how-doe...
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Mike Bronfman@mikebronfman · Meta AR COO, Harvard '16
This product gives you the big picture, fast; however, I hold a position where I'm clued into all of the financial aspects of my company, so I'm biased. I would imagine that the user experience varies from different perspectives...
332
Brent ChowHiring@hellobrent · Co-Founder at SVRF
Is it just me, or does it break when you add a round of funding?