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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, 2018 at 23:33
  • 2
    "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 says reinstate Monica
    Nov 13, 2018 at 7:41
  • @MawgsaysreinstateMonica Perhaps they didn't receive any salary increase during those 2 years, which would provide ample grounds for asking for equity.
    – user3738870
    Aug 17 at 20:06
  • @user5854648 It'd be really interesting to know the end of the story: did you end up asking for equity and did you get it?
    – user3738870
    Aug 17 at 20:07
  • I am happy to provide the outcome. I didn't need to "offer something" & you're spot on about my raise. I wanted 2%, received 1.5% equity, and slightly better pay. During my tenure I received 1 raise that was still way below average. I was eventually rewarded with an additional .5% equity bump bringing me to 2% equity. I was told I had the best comp package. I learned someone else who was there half the time made 30k more than me and had the 2% I originally wanted. I ended up leaving the company with about 1.25% equity. I'm now at a startup with a small equity benefit and over 180k salary.
    – user5854648
    Aug 24 at 16:03

3 Answers 3

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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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