
Ask HN: Salary and equity expectations for 4th employee - tmaki
Hi all,<p>I&#x27;ve recently graduated from university and have been offered a developer (web dev - rails) role at a startup. The company has a founder and 3 employees and I would be the 4th (2nd developer). I like the company a lot; I feel that they have a lot of potential. However I feel that as the 4th employee, the compensation is a little lacking.<p>Background: This is a Toronto start up (lower salary average) and they&#x27;re about to enter their round A&#x27;s
My offer: 40k + 0.5% equity (over 4 years + 6 month cliff)<p>I&#x27;m okay with the low salary as my living expenses are not that high, but I&#x27;m not so certain about the equity. However, I&#x27;ve been told that there are opportunities later on for me to get more? What do you guys think?
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JSeymourATL
Leaving $10-$15K on the table is significant. Start-up equity are lottery
tickets, with more losers than winners.

Areas to explore: What's your time worth? What if you traded equity for 8
weeks paid vacation instead? Is there any specific/unique work experience
(apprenticeship education) you could get at this firm?

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tmaki
Thanks, that seems like a good way to think about it. I'm a new grad, so I'm
definitely going to get a lot of experience with this company. But I just feel
that if I pour 60hr/week into it, I don't wanna exit the company 4 yrs later
with nothing.

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JSeymourATL
It's impossible to predict your exit. Too many variables at play beyond your
control. The most reasonable expectation is to be fairly compensated for your
time. It's the experience you gain, and relationships you make-- that will pay
dividends for the rest of your career.

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jesusmichael
You just got out of college and you got some equity and you don't think its
enough? Wow... If were the founder I'd wonder what a recent grad had to offer
to get any equity at all... Even if you got 1% or 2% the company would have to
be worth hundreds of millions for you to see big money... and if its going
that good then option and stock grants will be available to good employees.
Don't try to hit a home run on your first time at bat. If you don't strike
out... you're doing better than most.

However, I think you're looking at this the wrong way. Most startups fail..
you should be angling for more base and not worry about the equity at this
point... get the experience and add it to your portfolio and look to your next
job when this company tanks

~~~
tmaki
Thanks a lot, this was really helpful. More base sounds like the right
approach here...

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Furzel
Since you just graduated, remember to factor in the learning experience, I'm
not familiar with the rails ecosystem but if you are working with some really
good developers, you are gonna learn so much which is IMO worth way more than
equity. Especially since equity is kinda random ( remember 9 out of 10
startups fails ).

As said in another comment, ask them how they value the equity by bargain, can
you raise your wage and take no equity or have more holidays.

A last thing : Try an do some maths, like if you could get +1k/year how high
must the exit be for the 0.5% equity to be worth more than the wage raise.

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RollAHardSix
40k is low for rural usa, I couldn't imagine taking that in Toronto.

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staunch
It depends on you and the company. AngelList might be helpful. You can see
what other companies offer for salary and equity.

[https://angel.co/jobs#find/f!%7B%22locations%22%3A%5B%22Toro...](https://angel.co/jobs#find/f!%7B%22locations%22%3A%5B%22Toronto%22%5D%2C%22types%22%3A%5B%22full-
time%22%5D%2C%22roles%22%3A%5B%22Software%20Engineer%22%5D%7D)

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whiddershins
0.5% equity seems really small to me. This isn't based on a comparison to
other offers, or what is typical for the market, but rather on an intuitive
sense of fairness.

less-than-1% equity seems more like a symbolic percentage, and I might be
concerned about why the founder is so hesitant to share the pie with the
initial team.

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sjg007
1% or more

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tmaki
I've talked with a few people, and I'm on the same page as you. What do you
think is a fair package?

~~~
RollAHardSix
40k with 3-5% equity. 1-2% with 60k.

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jesusmichael
there's 20 guys fresh off the boat that will take the job for zero equity and
probably have more experience...

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RollAHardSix
That's any job. You have to take risks and ask for what you want to get it in
life. If this guy is being offered equity it's a fair bet the company is very
interested in him, more-so then a regular hire. To quote Zombieland: 'Time to
nut up, or shut up.'

