I received an attractive job offer from a startup, which includes a salary of x and equity that the startup values (let's say fairly) at y. y is a non-trivial sum; x+y is a high compensation, x is low. Ideal outcome for me is accepting the job with x+y salary - but some equity is okay, so long as y is not a significant chunk of x+y.
I don't want the equity because:
- I cannot confidently double check the valuation (private startup, no public data).
- There is a vestment schedule but I may or may not stay that long.
- The equity would increase my overall portfolio risk to unacceptable levels.
- I'm not that confident the company will actually do well over the long term. I don't think they are at unusually high risk of failure, I just don't have the time, inclination or data to do very detailed analysis of whether they will be a unicorn in ten years.
However, I am concerned that if I refuse the equity, they will construe that as not "believing in the company". Frankly, they would be right - I expect to be employed on a professional basis where I get compensated fairly for the work that I actually do. I'm not interested in doing extra work beyond that justified by my pay, out of the goodness of my heart, just to help the CEO succeed. Clearly I believe it is a company with decent prospects, which is why I'm even considering working there. But are their prospects so great that I want to own them? That discussion seems out of scope for a job offer.
What are my options? I can see:
- Ask for less equity and more cash, but very delicately. (how?)
- Pretend y=0 and judge the offer as x compensation, ignoring y entirely. (but then it's unlikely I will be able to reach an agreement with any startup)
- Try to value the equity myself (how?) at r*y s.t. r<1, then judge the offer as x+r*y compensation, ask for x+y which they will treat as a highball offer even though to me it's a normal-ball offer.
- Demand the usual investor relations stuff to justify their valuation - earning reports, financial statements, quarterly meeting transcripts, independent analyst reports, meeting with executives and so on. I doubt this would be effective.