The company recently got $3M investment. I’m being offered $152k salary and 2% equity, vested over 4 years. Is this good?

My thinking is that 2% of $3M is about $60k, so I could treat that as an extra $15k per year. But if I look at the valuation based on that investment, it is probably worth 5x that, like an extra $75k per year. All in all it is over $200k compensation, which I’m grateful for, but it’s on par with a tech job at a big tech company. Are these reasonable assumptions, or am I missing something?

  • Known_Impression1356BEnglish
    1·
    1 year ago

    This is all good advice to strongly bear in mind.

    I think the absolute failure rate of startups is probably 95%, but the failure rate of venture-backed startups is about 75%, pretty much in the middle of your high and my low, according to a 2022 Harvard Business School study (“The Venture Capital Secret: 3 Out of 4 Start-Ups Fail.”)

    Would only add that there are a fair number of service providers these days that will help employees exercise their options if the company is up and to the right. Might have to hand over a thirdish of your shares but you won’t have to come out of pocket for them.