Compensation · Employment law

Is it possible to pay early employee trough SAFE ?

Anonymous

March 9th, 2018

Hi,

We are a young start-up (2 co-founders) and don't have raise any money so far.

However we would like to employ 2 persons to grow. How can we "reward" them? We don't have any cash. Is it possible to deliver them SAFE (based on their contribution) every month ? How could we handle with that ?

Paul Garcia marketing exec & business advisor

March 11th, 2018

If you're not able to pay salaries, it's too early to talk about growth. Growth only happens when you have a product and customers and revenue and you're ready for more of those. Anything before that is still startup activity, not growth.


It's hard to get help without paying people. And frankly taking on additional people also takes away from your time and things that only you can work on, because those additional people require training, supervision, and monitoring. No intern, for lack of a better work, is actually free, because all your own time you put into managing them is a real cost.


The term SAFE is not known. Are you suggesting that you pay them on commission only? Are you offering them deferred salaries? Please use terms that describe a thing, not a mysterious acronym.


Are you sure you can handle or make good use of more people when you don't have any assets or resources yet? Are you that organized? What would these additional people do?


In my experience, trying to skip steps in development by adding more people to your business before you're ready will hurt you much more than it will help you. If you're not ready to pay people, and it doesn't sound like you're looking for additional partners in the business, then you're not ready for more people.

Avinash Rathi Technopreneur | Doer

March 21st, 2018

I would only say, you need to do more hard work to make it work out.

Its not the time to hire people, but its the time to be more organized.