Hacker News new | past | comments | ask | show | jobs | submit login
Ask HN: How to offer equity to founding team members?
1 point by codegeek on Nov 25, 2022 | hide | past | favorite | 4 comments
If you are starting a startup, outside of founders, how do you usually distribute equity ? Do you create like a 10% pool and allocate to say first 5-10 employees ? I may be asking this incorrectly but this stuff is a bit new to me being a bootstrapped founder so far. Any resources or guides is well appreciated.

Founder stock is separate from the employee pool.

Get your lawyer to draft up a founder stock purchase agreement as part of your incorporation.

Everyone after that point will be an employee, and their equity will come out of the 10% option pool.

Thanks. Any recommended resources to read/learn more about the 10% option pool ?

The Clerky handbook is a good resource: https://handbook.clerky.com/formation/equity-allocation.

It’s generally common practice. You can get away with 5% if you’re only hiring a couple of people.

The Unusual Ventures field guide covers alot of this:


Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact