Equity distribution · Contract negotiation

Guidance on leaving the rat race.. are they moving my cheese or eating it?

August 17th, 2016

Hello - long time start up bug inside me has finally broken out and I have networked my way into a few soft offers from incubator hatched ventures. Although I have 8 years post college experience navigating interviews and compensation offers - the creative terms and balancing act of an early hire offer have left me a bit uneasy. Wanted to ask for some advice on what I have so far. (FYI I'm a pure sales/biz dev/marketing guy)

B2B software platform + service:

Bootstrap/pre-seed stage, all tech is built out. Pilot customers are signed.

Would be first hire after founder, doing a little of ops/supply chain/processes... then market penetration and general sales + biz dev

Offering salary of $50,000 + equity (not yet disclosed)

They have runway of at least 6 months

B2C App:

Revenue positive, unsure of funding status. Limited amount of users from what I've seen on app store.

Would be hire 10-ish?

Would be almost exclusively biz dev + sales + user growth

Offering one month trial period where I am compensated solely based on incremental user growth tracked through a unique signup code. If I exceed expectations then I would receive a full time base + bonus + equity structure.

I'm not married to either one and am actively interviewing at others, but more so want to know if there's any glaring holes or things I need to ask or be away of. Thanks in advance!

Daniel Marques Director of Application Development at Pragma Securities LLC

August 17th, 2016

Which company is most likely to still be around in a year?

Which job will you learn/grow more at?

If they are equivalent in both factors, chose the one which is the "better" job (in a traditional sense - i.e. pays more, nicer co-workers, career growth).

If they aren't, figure out how valuable the learning/growth (at the one which offers more of it) is to you, compare that to the quality of job and likelihood of being around in a year, and make the choice which is best for you.

Greg Miller CEO and Founder at Greg Miller and Associates

August 17th, 2016

Henry, I know nothing at all about compensation specifics, but I do know this: fit with the company, passion for the idea, and the quality of the team matter much more than anything else in an early stage venture. This is not to say that you should ignore compensation, only that if you want to make "real" money you need an equity interest with a team you like and trust, and an idea about which you are enthusiastic. Those elements will be more important than the details of the deal. If the company works, the compensation will probably more or less work out if you put some care into it up front. If the company or the personal chemistry fail, you will walk away with nothing no matter what the deal is on paper. You might want to consult an employment lawyer. Early stage companies have a way of running out of cash from time to time. Don't sign up until you know the status of ACTUAL funding (not we will close soon...). Then decide if you there is cash flow risk, and if you can tolerate that risk. If you are as good at sales as you think you are, you will keep getting offers, so no need to jump at the first one. If the vagueness and risk that go along with joining an early stage company feel uncomfortable to you, don't quit your regular job. Greg

Guidance on leaving the rat race.. are they moving my cheese or eating it?

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