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Equity for Early Employees in Early Stage Startups

SoCal CTO

I was asked by a reader how much equity he should give out to early employees and to service providers in a very early stage startup. Founders vs. Early Employees To help with this discussion, let me start with a definition of "early employee." I'll get to service providers in a later post. Which means n = (i - 1)/i.

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Should Founders Be Allowed to Take Money off the Table?

Both Sides of the Table

I took money with a 3x participating preferred liquidation preference with 8% compounded interest annually. Coupled with my participating preferred from 1999 and 2000 I had more than $55 million of liquidation preferences. In my first company I had to raise money in April 2001 or die. Two answers from me.

Founder 329
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Cliff Notes S-1: Kayak ? AGILEVC

Agile VC

5) High Productivity: Kayak had 148 employees at the end of 2010. That means that Kayak generates roughly $1.15M in revenue for each employee which puts it in the same league as Google and Apple (both >$1M/head). liquidation preference, 6% accumulated dividend (1). Series A-1 Preferred. Series B Preferred.

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How to Work with Lawyers at a Startup

Both Sides of the Table

Forget to get around to setting up that Employee Stock Option Plan and want to be able to give the early guys their options at a low strike price? For company registration, angel deals, Series A & B funding, Employee Stock Option Plans (ESOP), IP filings and even litigation it doesn’t need to be that way.

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Thinking big and doing stuff properly

The Equity Kicker

That’s exciting and motivating for founders, and makes it easier to enlist support for your mission from investors, new employees and customers and will get you talked about on blogs and at cocktail parties. Big ambition should equate to a big opportunity to make a difference to the world and to make a lot of money. Powerful stuff.

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Top 30 Startup Posts in June 2010

SoCal CTO

liquidation preference. Your employees can’t also be your friends. Yes, even bootstrappers. haven't raised any money for my companies that required a term sheet (just friends & family money in my first company), and yet I still think it is important for a number of reasons. This pitcher has retired 5 of the last 7 batters.

Cofounder 175
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Twitter Link Roundup #216 – Small Business, Startups, Innovation, Social Media, Design, Marketing and More

crowdSPRING Blog

Sick Leave for Your Employees: Why it Matters – crowdspring.co/1gFez17. Sick Leave for Your Employees: Why it Matters – crowdspring.co/1gFez17. Good read for entrepreneurs & startup employees on liquidation preferences – crowdspring.co/1neVvzy. Most are spot on. ” – crowdspring.co/1lPU1Ks.