
Ask HN: What's the best way to give early employees ownership? - neuron9
Question: What&#x27;s the best way to give early employees ownership in a private tech company?<p>And by best, I mean best for the employees, not the company. There&#x27;s options, RSU&#x27;s, straight up equity (tax issues for receiver), and probably more...<p>With public companies, I get the value of issuing stock, because it has liquid value. But with private companies, without a definite IPO on the horizon, I&#x27;m truly interested at what talented engineers believe is the fairest instrument to share ownership&#x2F;reward.<p>I own a private tech company that makes $30m rev, is profitable, and has big potential. We currently have no shared ownership and I want to roll out a plan that has real value for employees, not perceived hype.<p>Your thoughts&#x2F;feedback would help me a ton!
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jpeg_hero
For truly early companies I would recommend getting a 409a valuation. This
value will be extremely low and have the employees buy the stock outright(or
with a note from the company) and have an expiring repurchase agreement for
the vesting part.

The fact that you are doing $30m in rev is a big hurdle to gettin a low
valuation.

What are you trying to accomplish? Are you trying to transfer value to the few
people that helped you get to $30m in rev or are you looking to incentivize
current employees going forward?

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cimmanom
Have you considered profit sharing instead of equity ownership?

