

Ask HN: Should I accept a Convertible Note? - denordec

Founder of a startup would like me to join the team as CMO. He is offering a convertible note, and a reasonable startup salary (represented by the note– let&#x27;s call it $75k). Can anyone help me with some do&#x27;s and don&#x27;ts here? Is this advisable?
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czbond
A convertible note keeps you and the founder from actually having to price the
value of the company today (which no-one can really do anyways). Do: See if
the shares convert to common or preferred (you REALLY want preferred, thats
what investors get - and at this stage you're an investor, of your time). Also
protect both of yourself with goals that are well thought out, and make sense.
Also remember that tasks like "Grow top line revenue by 30%", etc can actually
be very difficult to do at first. Potentially make it based on # of quality
hours put in. Do Be ok with the fact that there is only a 1/10 chance that
you'll see much if any money out of the deal. Do ask about existing other
shareholders, a plan for revenue, and the sales approach. Do look at the
revenue model.

