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I started working at a startup almost 2 years ago. I was brought on part-time. During negotiations I opted for a higher hourly rate as I needed the money and the management structure was questionable (it still is). We are still building our product and the team is small.

I was told I could expect full-time within 3-6 months of working there which still has not substantiated.

I am unsure what to ask exactly, but I would like some equity with the company. I have put about 2 years into the company and I still think we could be 6-12 months from launching the beta of our product.

I don't want to take less money, but should the company be sold I want to benefit from that as well. I do know 2 other employees have some equity with the company, but they are more important to the company at this current stage.

I have a very good relationship with the CEO and want to make my pitch in the next month or two. I've never asked for this, I have no idea how much equity to ask for either.

I appreciate advice on how to ask for equity at this stage, and any negotiating tips that may help my case.

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    What are you offering them in return? – solarflare Nov 12 '18 at 23:33
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    "During negotiations I opted for a higher hourly rate " - presumably instead of equity ... "I don't want to take less money, but should the company be sold I want to benefit from that". It seemed like an equity/salary trade-off then; what makes you think that that has changed now? – Mawg Nov 13 '18 at 7:41
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I appreciate advice on how to ask for equity at this stage

Just ask.

Point out the valuable work you have already done, but in particular emphasize the valuable work you will be doing.

Make sure it's understood that you would like to get some equity without taking a pay cut even though you took a higher rate rather than equity initially.

As a part-timer with a higher pay rate, you may end up with less equity than you would prefer, or realistically no equity at all. It may very well be that since you took a higher rate initially, you already forfeited your opportunity to get equity.

The only way you'll know is to ask.

Unless you know the amount of equity everyone already holds, you have no real basis to ask for a specific amount. So you might be better off to just leave that unsaid and just expect fairness.

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If your company does any sort of annual review, that would be the best time to bring up the subject.

Since you initially took a higher salary in lieu of equity, asking for equity instead of a payraise would give an option to shift your balance of compensation back toward the default of less pay but a handful of lottery tickets that only pay out years from now on going public/getting bought out.

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First you have to realize that you want get something for free.

So think about what you can offer:

  • Work more hours for the same money.
  • Instead of a raise (if you deserve one)
  • Get paid less money
  • Offer some asset of yours
  • Just pay for the shares you want.

As soon as you have figured out what you have to offer, try to get a good valuation. How much is what you offer worth and how much would be the current worth of the company. Remember, you won´t get the same price as your colleagues got when they made their deals 2 years ago, as the value of the company will probably have increased dramatically over the last two years.

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